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The Law of Electronic Commerce
Written specifically for legal practitioners and students, this book examines the concerns, laws and regulations involved in electronic commerce. In just a few years, commerce via the World Wide Web and other online platforms has boomed, and a new field of legal theory and practice has emerged. Legislation has been enacted to keep pace with commercial realities, cybercriminals and unforeseen social consequences, but the ever-evolving nature of new technologies has challenged the capacity of the courts to respond effectively. This book addresses the legal issues relating to the introduction and adoption of various forms of electronic commerce. From intellectual property, to issues of security and privacy, Alan Davidson looks at the practical challenges for lawyers and commercial parties while providing a rationale for the underlying legal theory. Alan Davidson is Senior Lecturer in the School of Law, University of Queensland. He is also a solicitor and barrister of the Supreme Court of New South Wales and the High Court of Australia.

The Law of Electronic Commerce
Alan Davidson

CAMBRIDGE UNIVERSITY PRESS

Cambridge, New York, Melbourne, Madrid, Cape Town, Singapore, São Paulo, Delhi, Dubai, Tokyo Cambridge University Press The Edinburgh Building, Cambridge CB2 8RU, UK Published in the United States of America by Cambridge University Press, New York www.cambridge.org Information on this title: www.cambridge.org/9780521678650 © Alan Davidson 2009 This publication is in copyright. Subject to statutory exception and to the provision of relevant collective licensing agreements, no reproduction of any part may take place without the written permission of Cambridge University Press. First published in print format 2009 ISBN-13 ISBN-13 978-0-511-69088-4 978-0-521-67865-0 eBook (NetLibrary) Paperback

Cambridge University Press has no responsibility for the persistence or accuracy of urls for external or third-party internet websites referred to in this publication, and does not guarantee that any content on such websites is, or will remain, accurate or appropriate. Reproduction and communication for educational purposes The Australian Copyright Act 1968 (the Act) allows a maximum of one chapter or 10% of the pages of this work, whichever is the greater, to be reproduced and/or communicated by any educational institution for its educational purposes provided that the educational institution (or the body that administers it) has given a remuneration notice to Copyright Agency Limited (CAL) under the Act. For details of the CAL licence for educational institutions contact: Copyright Agency Limited Level 15, 233 Castlereagh Street Sydney NSW 2000 Telephone: (02) 9394 7600 Facsimile: (02) 9394 7601 E-mail: info@copyright.com.au Information regarding prices, travel timetables and other factual information given in this work are correct at the time of first printing but Cambridge University Press does not guarantee the accuracy of such information thereafter.

Contents

Acknowledgements page xv Table of cases xvii Table of statutes xxv 1 The law of electronic commerce 1
Electronic commerce law
Internet use in Australia 2 5 6

Judicial consideration in Australia Further reading 10

2 The rule of cyberspace 11
Cultural and environmental juxtaposition with cyberspace Cyberspace 12 The rule of law and the rule of cyberspace 16
The rule of law 17 The rule of cyberspace 18 18 11

Spontaneous (or endogenous) order A code of cyberspace 20 Information wants to be free 22 Conclusion 23 Further reading 24

3 Electronic commerce and the law of contract 25
UNCITRAL Model Law of Electronic Commerce 25 Legislation 27
Australia 27 New Zealand 28 Provisions of the Electronic Transactions Acts 29 Electronic contracts 30 Common law 31 Application of the common law 31 Exemptions 33 Exemption does not equate to a paper requirement New Zealand 34 Validity of electronic transactions 35

34

v

vi

CONTENTS

Writing 36
Australian provisions 37 New Zealand 39 Signatures 39 Australian provisions 40 New Zealand provisions 45 Production of documents 47 Consent 48 Example 50 Other countries’ provisions 51 Comment 52

Retention of information and documents
Retention in paper form 53 Retention in electronic form 53

52

Time and place of dispatch and receipt of electronic communications 54
Time of dispatch 55 Time of receipt 56 Acceptance by electronic communication and the postal acceptance rule Place of dispatch and place of receipt 61 Attribution of electronic communication 61 Originals 63 Electronic Case Management System 63 Comment 63 Further reading 64

57

4 Shrinkwrap, clickwrap and browsewrap contracts 66
Shrinkwrap 67 Clickwrap 68 Browsewrap 70 Electronic agents 72 Further reading 73

5 Electronic signatures 74
Traditional signatures 74 Modern signatures 77 Electronic signing 77 Acceptance at face value and risk 79 Functions of signatures 79 Electronic Transactions Acts 80 ‘Electronic signature’ defined 82 Uses 83 Security of electronic signature 83
Digitised signatures 84 Digital signatures 84

format-shifting and space-shifting 101 Piracy and enforcement 102 Peer-to-peer file sharing 102 Authorisation 105 Carrier protection 108 Hyperlinking 108 Further reading 109 7 Electronic commerce – trade marks.CONTENTS vii Australian Business Number Digital Signature Certificates 86 Secure Socket Layer – Transport Layer Security 87 Applications 88 Further Reading 88 6 Copyright issues in electronic commerce 89 The nature of copyright Exclusive rights 91 Infringement 92 89 Substantial part 93 Objective similarity and causal connection Software 96 Right of communication 97 Exemptions 98 Libraries and archives 98 Educational statutory licences 99 Temporary reproductions 99 Enforcement measures 99 95 Time-shifting. patents and circuit layouts 110 The nature of trade marks 110 Infringement 112 Hyperlinking 113 Framing 115 Meta-tags 117 Patents for software and internet processes 119 Developments in the United States Developments in Europe 120 Developments in Australia 120 Patents and hardware 122 Circuit layout rights 123 Further reading 125 119 8 Domain names 126 Mapping cyberspace 126 Business identifiers 127 The nature of domain names 128 Top Level Domains names (TLDs) 129 .

nz DRSP 177 171 .us 132 .in 133 131 TLD rationale ICANN 135 134 InterNIC 136 Whois 137 ICANN Ombudsman 137 Nexus requirements 138 gTLD nexus requirements 138 .us nexus requirements 140 .uk 133 .uk nexus requirements 141 .au 131 .nz nexus requirements 140 .au nexus requirements 139 .viii CONTENTS Generic Top Level Domain Names (gTLDs) 129 Country Code Top Level Domain names (ccTLDs) .nz 132 .in nexus requirements 141 9 Domain name disputes 142 Cybersquatting 142 Dispute resolution 143 Remedies using the court process 144 Cause of action 144 US experience 146 International approaches 148 Domain name passing off 151 Oggi Advertising Ltd v McKenzie 152 Marks & Spencer v One in a Million 153 Developments 156 Trade Practices Act relief 157 Fraud 160 Conclusion 162 Further reading 162 10 Uniform domain name dispute resolution policies 163 WIPO internet domain name reports 164 UDRP rules 165 Identical or confusingly similar 166 Trademark or service mark 168 Registrant has no rights or legitimate interests Registration and use in bad faith 172 UDRP process 175 ccTLD dispute resolution policies 176 auDRP 176 .

uk DRSP 178 INDRP 179 Additional policies 179 Practical ramifications 181 Conclusion 181 Further reading 182 178 11 Jurisdiction in cyberspace 183 Rules of private international law 183 Forum non conveniens 184 Dow Jones v Gutnick 185 Adventitious and opportunistic Effects test 190 Australian cases 191 Early US experience 194 Universal rights 196 Alternative approaches 198 Single publication rule 200 Substantial publication 201 189 Uniform defamation legislation – choice of law 201 Conclusion 202 Further reading 203 12 Defamation in cyberspace 204 Defamation principles 205 Defamation reform 206 Defamation in cyberspace – actions and issues 206 Statute of limitations 210 Single publication rule 210 Single controversy principle Single cause rule 213 213 Adventitious or opportunistic conduct 213 Jurisdiction for defamatory statement 214 Conclusion 214 Further reading 215 13 Privacy and data protection in cyberspace 216 Information wants to be free 217 Privacy and regulation 218 Information privacy 218 Australia 221 National Privacy Principles (NPP) Data protection 225 Victoria 225 New South Wales 226 223 .CONTENTS ix usTLD Dispute Resolution Policy .

x CONTENTS Queensland 226 Western Australia 226 South Australia 227 Tasmania 227 Northern Territory 227 Australian Capital Territory Abuses 228 Cookies 228 Web bugs 231 228 International Covenant on Civil and Political Rights (ICCPR) 232 Data protection 232 Review 233 Personal privacy 235 New Zealand 240 United States 241 Final comment 242 Further reading 242 14 Electronic mail and online presence 243 243 Attachments 244 Authentication 244 Language 245 Viruses 246 Disclaimers 246 Risk assessment 248 Service of documents by email 248 Time and place of dispatch and receipt 249 Web page presence 250 Liability for online material 250 Disclaimers – conditions of use 251 Information to be placed on pages for practical and legal purposes Newsgroups and mailing lists 253 The professional office and email 253 Backup copies 253 Maintain supervisory checks 253 Records and costing 254 Confidentiality 254 Internal trial 254 Confirmation of sending 254 Access to files 255 A new form of expression 255 Conclusion 255 Email 252 15 National electronic surveillance 256 The USA PATRIOT Act 256 Australian response 257 .

2) 2005 (Cth) 261 Ambassador for Counter-Terrorism 262 Memorandums of Understanding on counter-terrorism 263 International Conventions 263 Conclusion 265 16 Cybercrime 267 The Commonwealth Criminal Code and computer crime Telecommunications services 270 Child pornography 271 Assisting suicide 273 268 Police and security powers 273 Investigative powers 274 State legislative offences relating to computers New Zealand 276 Child pornography – international 277 Internet gambling 278 The problem 278 International Gambling Act 2001 (Cth) Comment 280 Cyberstalking 280 279 275 International approach to cybercrime Spam 283 The problem 283 Spam Act 2003 (Cth) 284 New Zealand response 289 US response 290 EU response 290 Criticisms 291 282 National Do Not Call Register 291 .CONTENTS xi Criminal Code Amendment (Anti-Hoax and Other Measures) Act 2002 (Cth) 257 Security Legislation Amendment (Terrorism) Act 2002 (Cth) 258 Suppression of the Financing of Terrorism Act 2002 (Cth) 258 Criminal Code Amendment (Suppression of Terrorist Bombings) Act 2002 (Cth) 258 Telecommunications Interception Legislation Amendment Act 2002 (Cth) 258 Criminal Code Amendment (Offences Against Australians) Act 2002 (Cth) 259 Australian Security Intelligence Organisation Legislation Amendment (Terrorism) Act 2003 (Cth) 259 ‘Terrorism act’ 259 Anti-Terrorism Act 2004 (Cth) 260 Surveillance Devices Act 2004 (Cth) 260 Anti-Terrorism Act (No.

xii CONTENTS Identity fraud 292 Identity fraud and terrorism 293 Technological response 293 Governmental response 293 Phishing 295 Further reading 295 17 Evidence of electronic records 296 Evidence of electronic records 296 Background 297 Secondary evidence rule 298 Evidence legislation 301 Legislation abolishing the ‘original document’ rule 304 International perspective 305 Hard copies of electronic records as evidence 308 Originals and copies – envelopes and attachments 310 Conclusion 312 Further reading 312 18 Censorship – Broadcast and online content regulation 313 The Australian Communications and Media Authority 313 The internet 314 Radio and television 314 Telephones 315 Licences 315 Consumers 316 Industry 316 Internet content 316 US cases 317 Australia 318 Referral to law enforcement agencies 320 Take-down notices 320 Service-cessation notices 321 Link-deletion notices 321 Industry codes 322 Complaints and investigations 322 Conclusion 322 International comparison 323 UK 323 EU 323 Television 323 ACMA’s enforcement powers 324 Television Classification Guidelines in practice 325 Radio broadcasting codes and breaches 325 Codes of practice 325 Investigations 326 Encouraging violence and brutality – the Alan Jones case Conclusion 329 327 .

au Dispute Resolution Policy (auDRP) 380 Appendix F National Privacy Principles 386 Index 395 .CONTENTS xiii 19 An international perspective 330 UN Commission on International Trade Law (UNCITRAL) 331 The UNCITRAL Model Law on Electronic Commerce 332 The UNCITRAL Model Law on Electronic Signatures 332 The UN Convention on the Use of Electronic Communications in International Contracts 334 World Trade Organization (WTO) 335 General Agreement on Tariffs and Trade (GATT) 336 The Organization for Economic Cooperation and Development (OECD) 336 The Asia Pacific Economic Cooperation (APEC) 338 Summary 340 International Chamber of Commerce (ICC) 340 International Organization for Standardization (ISO) 341 International Labour Organization (ILO) 342 International Telecommunication Union (ITU) 343 UN Centre for Trade Facilitation and Electronic Business (UN/CEFACT) 343 UN Conference on Trade and Development (UNCTAD) 344 UN Educational. Scientific and Cultural Organisation (UNESCO) Universal Postal Union (UPU) 345 World Bank 345 World Customs Organisation (WCO) 346 World Intellectual Property Organisation (WIPO) 346 344 Appendix A Electronic Transactions (Victoria) Act 2000 348 Appendix B UNCITRAL Model Law on Electronic Commerce 357 Appendix C Selected provisions Copyright Act 1968 (Cth) 365 Appendix D ICANN Uniform Dispute Resolution Policy (UDRP) 375 Appendix E .

.

digital privacy. that the legal system faced real challenges in private. whatever the human mind may create can be reproduced and distributed infinitely at no cost. May it be more humane and fair than the world your governments have made before. I would like to thank my colleagues Russell Hinchy. but it is not where bodies live . But it was not until the creation and growth of computers and the internet. At the time the combination was most unusual. identity theft. and the functional equivalence of writing and signatures (by the UNCITRAL Models Law of Electronic Commerce and the Electronic Transaction Acts). and the development of this realm called cyberspace.Acknowledgements On one analysis electronic commerce emerged in mid 19th century with the invention of the telegraph and telephone. We will create a civilization of the Mind in Cyberspace.1 In the past two decades many of the legal challenges have been answered. but the world of cyberspace and the regulation of that world have now become part of the landscape. . jurisdiction in cyberspace (in Dow Jones v Gutnick [2002] HCA 56). Some of the major ones are the global content of the internet (in Reno v American Civil Liberties Union 521 US 844 (1997)). John Perry Barlow declared: Ours is a world that is both everywhere and nowhere. email and cybersquatting. In our world. My interest in this area arose some three decades ago when I undertook a degree in computing science while practising law. ‘the new home of the mind’. Speaking about cyberspace. Paul O’Shea and my research assistant William Hickey for their feedback. It is intended for legal practitioners and students of what has broadly become known as cyberlaw. The aim of this work is to define the law relating to electronic commerce within Australia as determined by the legislature. Other areas that have been dealt with include the regulation of spam. The milestones in the past 20 years have been many. public and criminal law. suggestions and assistance. The global conveyance of thought no longer requires your factories to accomplish. internet gambling. I would especially like to thank my assistant and colleague Garth Wooler for his 1 John Perry Barlow. . xv . “Declaration of Independence of Cyberspace”. judicial interpretations and the common law.

TC Beirne School of Law University of Queensland Solicitor and Barrister April 2009 . Finally I would thank my late father and my wonderful family Dianne. Dr Alan Davidson Senior Lecturer. Taylor and Chelsea. proofreading and contributions.xvi ACKNOWLEDGEMENTS patience.

v King 937 F. 3d 1274 (DC Cir 1993) 309 Armstrong v Executive of the President 810 F. 96 AV et al v IParadigms LLC Company Civ Act. 239 F. 824 (1996) 8 APRA v Canterbury-Bankstown League Club Ltd [1964] NSWR 138 90 APRA v Commonwealth Bank of Australia (1993) 25 IPR 157 90 Architects (Australia) Pty Ltd (trading as Architects Australia) v Witty Consultants Pty Ltd [2002] QSC 139 156 Arica Institute Inc. 213 Australian Communications and Media Authority v Clarity1 Pty Ltd [2006] 410 FCA 286 Australian Competition and Consumer Commission v Chen [2003] FCA 897 159 Australian Competition and Consumer Commission v Purple Harmony Plates Pty Limited [2001] FCA 1062 193 Australian Football League v Age Company Ltd [2006] VSC 308 203 Australian Railways Union v Victorian Railways Commissioners (1930) 44 CLR 319 186 Australian Stock Exchange Ltd v ASX Investor Services Pty Ltd (QSC 1999) 153 Autodesk Inc. 2 (1993) 176 CLR 300 93.com WIPO Case No D2001-0213 167 Airways Corporation of NZ Ltd v Pricewaterhouse Coopers Legal [2002] NSWSC 138 192 Allocation Network Gmbh v Steve Gregory (allocation. v Dyason No.com) WIPO No D2000-0016 175 American Civil Liberties Union v Reno 929 F. 3d 1004 (9th Cir 2001) 102 Adams v Lindsell (1818) B & Ald 681 57 ADT Services AG v ADT Sucks. 240 Australian Broadcasting Corporation v Waterhouse (1991) 25 NSWLR 519 200. Supp. Supp. 94. 2d 1067 93 Armstrong v Executive of the President 1 F. [2002] 1 AC 615 6 Athens v Randwick City Council [2005] NSWCA 317 118 Atlantic Underwriting Agencies Ltd v Compagnia di Assicuranzione di Milano SpA [1979] 2 Lloyds Rep 240 184 Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd [2001] HCA 63 236. 296 (SD NY 1996) 195 Berezovsky v Michaels [2000] UKHL 28 212 xvii . v Napster Inc. v Dyason No. 2d 531 32 Barrett v Rosenthal (2006) 40 Cal 4th 33.Table of Cases A & M Records Inc. v Palmer (1992) 970 F. 1 (1992) 173 CLR 330 93 Autodesk Inc. Supp.. Supp. No 07-0293 (ED Va 2008) 69 Ballas v Tedesco 41 F. 335 (1993) 309 Arthur J S Hall & Co v Simmons [2000] UKHL 38. 146 P 3d 510 209 Bensusan Restaurant Corp.

Interactive Communications Inc. 150 F. D2000-1532 171 Butera v Director of Public Prosecutions for the State of Victoria (1987) 164 CLR 180 298. 202 Campomar Sociedad Limitada v Nike International Limited [2000] HCA 12 113. 130 F. v NABR WIPO Case No. 3d 1257 (6th Cir 1996) 195 Computer Edge v Apple (1986) 161 CLR 171 96 connect. 3d 414 (9th Cir 1997) 195. 1998) 207 Databank Systems Ltd v Commissioner of Inland Revenue [1990] 3 NZLR 385 30 Derry v Peek (1889) 14 App Cas 337 160 Diageo plc v John Zuccarini WIPO Case No. v Kremer 403 F. D2000-0788 175 Blue Sky Software Corp v Digital Sierra Inc. WIPO Case No. 149 Cantor Fitzgerald International v Tradition (UK) Ltd [2000] RPC 95 94 Car Toys Inc. (1973) 129 CLR 353 113 Bernstein v JC Penny Inc. 96 Data Concepts v Digital Consulting Inc. D2000-0004 175 Coca-Cola v F Cade & Sons Limited [1957] IR 196 169 Commissioner of Inland Revenue v B [2001] 2 NZLR 566 241 Compuserve Inc. 78 CCOM Pty Ltd v Jiejing Pty Ltd (1994) 27 IPR 481 121 Chakravarti v Advertiser Newspapers Ltd [1998] HCA 37. Ltd’s Application (1968) 38 AOJP 1020 121 British Telecom v One in a Million [1999] 1 WLR 903 153 Bruce Springsteen v Jeff Burgar and Bruce Springsteen Club WIPO Case No. 60 British Petroleum Co.au Pty Ltd v GoConnect Australia Pty Ltd [2000] FCA 1148 153 Coogi Australia Pty Ltd v Hysport International Pty Ltd [1998] FCA 1059 92 Cooper v Universal Music Australia Pty Ltd [2006] FCAFC 187 105 Cramp & Sons Ltd v Frank Smythson Ltd [1944] AC 328 90 CSR Limited v Resource Capital Australia Pty Limited [2003] FCA 279 158 Cubby v CompuServe 776 F. v Patterson 89 F. D2001-1480 167 Calder v Jones 465 US 783 (1984) 188. 135 (SDNY 1991) 209 Cybersell Inc.com. v Informa Unlimited. WIPO Case No. Supp.xviii TABLE OF CASES Berlei Hestia Industries Ltd v Bali Co. Inc. 199. 58. 3d 620 (6th Cir. Inc. 196 Darryl v Evans (1962) HC 174 32 Data Access Corporation v Powerflex Services Pty Ltd [1999] HCA 49 94. D2000-0996 167 . 198. and Network Solutions Inc. 299 BWT Brands Inc and British American Tobacco (Brands) Inc. D2000-0165 166 Bosley Medical Institute Inc. 190.com) WIPO Case No. v Kostiuk (1999) 63 BCLR (3d) 156 194 Brinkibon Ltd v Stahag Stahl und Stahlwarenhandelsgesellschaft mbH [1983] 2 AC 34 30. 50 USPQ 2d 1063 (CD Cal 1998) 115 Bixee v Naukri (2005) IA no 9733/2005 115 Blackie & Sons Ltd v Lothian Book Publishing Co. 57. Ltd v Ashita Tele Systems Pvt Ltd (2003) (27) PTC 265 (Del) 195 Caton v Caton (1867) LR 2 HL 127 75. v Cybersell Inc. (1998) 193 CLR 519 205 Chief Executive Department Internal Affairs v Atkinson HCNZ unreported CIV-2008-409-002391 (2008) 290 Church of Scientology v Woodward [1982] HCA 78 236 City Utilities v Ed Davidson (cityutilities. 3d 672 (9th Cir 2005) 168 Braintech Inc. Pty Ltd (1921) 29 CLR 396 93 Blue Cross and Blue Shield Association and Trigon Insurance Company v. (2000) NAF 93682 175 Casio India Co.

v Rural Telephone Service Co. Supp. DAU2002-0001 173 Godfrey v Demon Internet Ltd [2001] QB 201 187 Golden Acres Ltd v Queensland Estates Pty Ltd [1969] Qd R 378 184 Golden Eagle International Trading Pty Ltd v Zhang [2007] HCA 15 299 Goodman v J Eban Ltd [1954] 1 QB 550 75 Graham Technology Solutions Inc. 205. 78 Experience Hendrix LLC v Denny Hammerton and The Jimi Hendrix Fan Club WIPO Case No. 210. Consultations [1982] Ch 119 93 Faulks v Cameron [2004] NTSC 61. D2000-0584 167 Doherty v Registry of Motor Vehicles No.. D2000-1259 161 DPP (Cth) v Rogers [1998] VICSC 48 270 DPP v Sutcliffe [2001] VSC 43 282 Duchess of Argyle v Duke of Argyle [1967] Ch 302 217 Eastman v R (1997) 76 FCR 9 305 Eddie Bauer Inc. 30 ER 205 75 Energy Source Inc. 622 (Kan 1990) 90 Fiber-Shield Industries Inc. D2000-0583 167 Dixons Group PLC v Purge IT WIPO Case No. 198. DAU2004-0007 177 Giller v Procipets [2004]VSC 113 237 GlobalCenter Pty Ltd v Global Domain Hosting Pty Ltd Case No. 214 Dow Jones v Powerclick Inc.TABLE OF CASES xix Digital Equipment Corporation v Alta Vista Technology Inc. 1427 (ND Cal 1997) 32 Grant v Commissioner of Patents [2005] FCA 1100 122 Griswold v Connecticut 381 US 479 (1965) 232 . 211 Fletcher Challenge Ltd v Fletcher Challenge Pty Ltd [1981] 1 NSWLR 196 160 Fletcher v Bealey (1885) 28 ChD 688 154 Francis Day & Hunter Ltd v Bron [1963] Ch 587 95 Freeserve PLC v Purge IT WIPO Case No. D2000-0364 170 Exxon Corp v Exxon Ins. v Paul White (2000) eResolution AF-204 161. 97CV0050 (Mass 1997) 79 Dow Jones & Co. 456 (D Mass 1997) 187 Dilosa v Latec Finance Pty Ltd (1966) 84 WN (Pt 1) (NSW) 557 287 Direct Line Group Ltd v Purge IT WIPO Case No. WIPO Case No. v Harrods Ltd 237 F. FA0096364 168 Entores Ltd v Miles Far East Corp [1955] 2 QB 327 58 EPP v Levy [2001] NSWSC 482 217 ESAT Digifone Ltd v Colin Hayes WIPO Case No. D2000-0585 167 Futuredontics Inc. Supp. (9th Circuit 1998) 116 G v Day [1982] 1 NSWLR 24 217 GE Capital Finance Australasia Pty v Dental Financial Services Pty Ltd Case No. 191. 77. 2d 394 (SDNY 2002) 200 Dow Jones v Gutnick [2001] VSCA 249 185. 189–90. Inc. FA0001000092054 169 Firth v State of New York 775 NE 2d 463 (2002) 201. 960 F. 610. Supp. 196. v Your Energy Source NAF No. (2004) 32 Fam LR 417 44 Feist Publications Inc. D2000-0600 169 Evans v Hoare [1892] 1 QB 593 75. 204. v Thinking Pictures Inc. 185–6. 210. v Fiber Shield Ltd NAR (2000) No. 211. 189 Dow Jones v Gutnick [2002] HCA 56 6. 200. 737 F. Inc. Supp. 168 Ellis v Smith (1754) 1 Ves Jun 11 at 12. 949 F. v Applied Anagramatics Inc.

15/2001. 3d 811 (CA9 2003) 104 Kitakufe v Oloya Ltd [1998] OJ No 2537 QL (Ont Gen Div) 187 Knight v Crockford (1794) 1 Esp N P C 190. AF-0807 173 Jeanette Winterson v Mark Hogarth WIPO Case No. Inc. D2000-0867 170 J Pereira Fernandes SA v Mehta [2006] EWHC 813 41. 160. 117 (DC Cal 1948) 77 Julia Fiona Roberts v Russell Boyd WIPO Case No. 161 Hodgkinson & Corby Ltd v Wards Mobility Services Ltd [1994] 1 WLR 1564 151 Hotmail Corp v Van$ Money Pie Inc 47 USPQ 2d 1020 (1998) 68 Hume Computers Pty Ltd v Exact International BV [2007] FCA 478 32. 158 Kelly v Arriba Soft Corporation 336 F. Pty Ltd [2004] WASTR 25 49. [2003] EWHC 1162 201 Harrods Ltd v UK Network Services Ltd (1997) EIPR D-106 153 Hawkes & Son (London) Ltd v Paramount Film Service Ltd [1934] 1 Ch 593 93 Healthgrades. Supp. 193 Harris v Selectrix Appliances (Complaints Review Tribunal. 50 Inset System Inc. 199 Hedley Byrne v Heller [1964] AC 465 246 Helicopteros Nationales de Columbia SA v Hall 466 US 408 194 Henderson v Henderson [1843] 3 Hare 100. 64 I Lan Systems Inc. 34. 95 .xx TABLE OF CASES Grosse v Purvis [2003] QDC 151 237. 01-35648 (9th Cir 2002) 191. 203 Investment India Ltd v ICIC (Mumbai High Court 2000) 157 Isabelle Adjani v Second Orbit Communications Inc. (D Mass 2002) 69 IBM Corporation v Commissioner of Patents (1991) 22 IPR 417 121 Ilich v Baystar Corp. [2005] EWCA Civ 75 201 Jane Doe v ABC [2007] VCC 281 237 Jazid Inc. 2001) 241 LA Times v Free Republic 54 USPQ 2D 1453 (2000) 103 Ladbroke (Football) Ltd v William Hill (Football) Ltd [1964] 1 WLR 273 93. v Instruction Set Inc. v National Envirotech Group (1997) LLC. v Yoga Magik Pty Limited [2003] FCA 536 118. La. 2] (1965) 112 CLR 206 268 Jones v Dunkel (1959) 101 CLR 298 287 Joseph Denunzio Fruit Company v Crane 79 F. Decision No 12/2001.) 118 Interfoto Picture Library Ltd v Stiletto Visual Programmes Ltd [1989] 1 QB 433 67 International Shoe Co. v Washington 326 US 310 (1945) 194. Supp. 214 Henthorn v Fraser [1892] 2 Ch 27 57 Hill v Gatway 2000 Inc 105 F. 167 L v L (Complaints Review Tribunal. 194 Insituform Technologies Inc. Inc. 43 Jameel v Dow Jones & Co. 191. 952 F. Civ. 67 ER 313 213 Henry v Henry (1996) 185 CLR 571 184. D2000-0210 170 Kailash Center for Personal Development Inc. 170 ER 324 75 Koninklijke Philips Electronics NV v Remington Products Australia Pty Ltd (2000) 100 FCR 90 113. 2001) 241 Harrods Limited v Dow Jones & Co. WIPO Case No. 97-2064 (ED. 1119 (WD Pa 1997) 192. Michelle McKinnon v Rennemo Steinar eResolution Case No. 240 Gutnick v Dow Jones [2001] VSC 305 185. 52. No. 3d 1147 (7th Cir 1997) 68 Hoath v Connect Internet Services [2006] NSWSC 158 153.com v Northwest Healthcare Alliance No. 146. Decision No. D2000-0235 169 Jones v Commonwealth [No. v Netscout Service Level Corp.

64 McLane Company Inc. D2000-1455 167 McLean v David Syme & Co. v Commissioner of Patents (1959) 102 CLR 252 121 National Westminster Bank PLC v Purge IT WIPO Case No. 2246 (Sup Ct) 16 Orange Crush (Australia) Ltd v Gartrell (1928) 41 CLR 282 151 PA Consulting Services Pty Ltd v Joseph Barrington-Lew WIPO Case No. D2000-0636 167 Natural Floor Covering Centre Pty Ltd v Monamy (No. 21.com Inc. 160 Mary-Lynn Mondich and American Vintage Wine Biscuit Inc. [1998] EWCA Civ 1272 8. 194 MP3. 2003) 208 Nicholas v Borg (1986) 7 IPR 1 160 Nokia Corporation v Nokiagirls. Limited (1970) 72 SR (NSW) 513 207 Mehta v J Pereira Fernandes SA [2006] EWHC 813 78 Mendelson-Zeller Co. 947 F. Supp. 52. 214. 1328 (ED Mo 1996) 194 Marks & Spencer plc v One in a Million [1999] 1 WLR 903. D2000-0005 173 Minnesota v Granite Gate Resorts Inc. 76 Lockheed Martin Corporation v Dan Parisi WIPO Case No. 153–6. D2000-1015 167 Lockheed-Arabia v Owen [1993] 3 WLR 468 32 Lott v JBW & Friends PL [2000] SASC 3 90 Loutchansky v Times Newspapers Ltd (Nos 2–5) [2002] QB 783 200 Mabo v Queensland (No 2) [1992] HCA 23. 26 ER 15 298 Ontario Inc v Nexx Online Inc. v Fay (1988) 62 ALJR 389 184. 1) [2006] FCA 518 118 Net2Phone Inc v Los Angeles Superior Court 109 Cal App 4th 583 (Cal. D2000-0847 170 Marengo v Darly Sketch & Sunday Graphics Ltd (1948) RPC 242 150 Maritz Inc. v Cybergold Inc. 34. DAU2003-0002 169 . 44. 568 NW 2d 715 184. 83 ER 545 75 L’Estrange v Graucob [1934] 2 KB 394 80 Libro Ag v NA Global Link WIPO Case No.TABLE OF CASES xxi Lazarus Estates Ltd v Beasley [1956] 1 All ER 341 76 Lee Teck Chee v Merrill Lynch International Bank [1998] CLJ 188 187 Lemayne v Stanley (1682) 3 Lev 1. D2000-0579 168 National Research Development Corp. 248 Macquarie Bank v Berg [2002] NSWSC 254 193 Madonna Ciccone v Dan Parisi WIPO Case No. WIPO Case No. D2000-0102 166 NRMA v John Fairfax [2002] NSWSC 563 237 Oceanic Sun Line Special Shipping Co. D2000-0186 171 Lobb v Stanley (1844) 5 QB 574. v Absolute Air Cleaners and Purifiers. 214 Oggi Advertising Ltd v McKenzie (1999) 44 IPR 661 152–3 Olley v Marlborough Court [1949] 1 KB 532 66 Omychund v Barker (1745) 1 Atk. Inc. D2000-0004 174 McGuren v Simpson [2004] NSWSC 35 32. v T & C Providores Pty Ltd [1981] 1 NSWLR 366 184 Merrill Lynch’s Application [1989] RPC 561 120 MGM v Grokster 545 US 913 (2005) 104 Mick Jagger v Denny Hammerton NAF FA0095261 170 Microsoft Corporation v Amit Mehrotrata WIPO Case No. Ct App. v Big Daddy’s Antiques WIPO Case No.com WIPO Case No. v Fred Craig WIPO Case No. 191. 114 ER 1366 75. [1999] OJ No. (1992) 175 CLR 1 8 Macmillan v Cooper (1923) 93 LJPC 113 90 Macquarie Bank v Berg [1999] NSWSC 526 187. v Sander WIPO Case No. D2000-0053 175 Miele Inc. 158.

318. v Calvin Designer Label 985 F. 68 Peek v Gurney (1873) LR 6 HL 377 160 Philippe Tenenhaus v Telepathy Inc. 199 SE 416 76 Soci´t´ Accor contre M Philippe Hartmann WIPO Case No. v Universal City Studios 464 US 417 (1984) 103 Sony Kabushiki Kaishal v Sin Eonmok WIPO Case No. (No. 13. v Hie Holdings Pty Ltd [1999] ATMO 68 117 Playboy Enterprises Inc. [1997] FSR 604 114 SM Integrated Transware v Schenker Singapore Ltd [2005] 2 SLR 651 52. Supp. 72 Reno v American Civil Liberties Union 521 US 844 (1997) 8. 3d 1447 (7th Cir 1996) 67 Qantas Airways Limited v The Domain Name Company Limited (2000) 1 NZECC 70-005 157 R v Brislan. Ex parte Williams (1935) 54 CLR 262 268 R v Burdett (1820) 4 B & Ald 115 188 R v Frolchenko (1998) QCA 43 77. 2d 1220 (ND Cal 1997) 118. 145. v Verio Inc.com Inc.xxii TABLE OF CASES Panavision International v Toeppen (1998) 141 F. 3d 1316 (9th Cir) 144. 3d 707 (4th Cir 2002) 198 Schneider v Norris (1814) 2 M & S 286 75 Shell Co. D2000-1007 168 Specht v Netscape Communications Corp. v Chuckleberry Publishing Inc. 146 Parker v The South Eastern Railway Co. 3d 1169 (9th Cir 1998) 117. Ex Parte Myers (1884) 10 VLR 322 76 R v Shephard [1993] AC 380 302 R v Stevens [1999] NSWCCA 69 270 Re Eilberg 49 USPQ 2d 1955 (1998) 170 Re Krupp [1999] EIPR N24 150 Re United Railways of the Havana and Regla Warehouses Ltd [1960] Ch 52 184 Reckitt & Colman Products Ltd v Borden Inc. 3d 393 (2nd Cir 2004) 69. 214 . v Digital Service Consultants Inc. 293 F. 323 Rindos v Hardwick (unreported) WASC (1993) 207 Roe v Wade 410 US 113 (1973) 232 Satyam Infoway Ltd v Siffynet Solutions Pvt Ltd (2004) (28) PTC 566 (SC) 150. v Welles 162 F. 64 Smith v Greenville County (1938) 188 SC 349. of Australia Ltd v Esso Standard Oil (Aust) Ltd (1963) 109 CLR 407 113 Shetland Times Ltd v Wills and Zetnews Ltd [1997] 37 IPR 71. 356 F. 3) [1990] 1 WLR 491 151 Reddaway v Banham [1896] AC 199 151 Rediff Communication Ltd v Cyberbooth AIR (2000) Bom 27 157 Reese Bros Plastics Ltd v Hamon-Sobelco Aust Pty Ltd (1988) 5 BPR 11. 147 Playboy Enterprises Inc. (2000) NAF 94355 175 Pitman Training Limited v Nominet [1997] EWHC Ch 367 144. (1877) 2 CPD 416 66. Ltd v Cansulex Ltd [1987] AC 460 184. 2d 585 (SDNY 2001) 70 Spiliada Maritime Corp. 150 F. 106 30 Regie National des Usines Renault SA v Zhang [2002] HCA 10 184. 118 Polaroid Corp. 300 R v Idolo [1998] VICSC 57 270 R v Maqsud Ali [1966] 1 QB 688 300 R v Moore. 272. 939 F. 214 Register. 1032 (SDNY 1996) 196 Playboy Enterprises Inc. 146 Playboy Enterprises Inc. v Sole N Pty Ltd [1981] 1 NSWLR 491 113 Powell v Birmingham Vinegar Brewing Co Ltd [1897] AC 710 160 Premier Brands v Typhoon [2000] RPC 477 149 ProCD Inc v Zeidenberg 86 F. D2001-0007 167 ee Sony Corp. Supp. 160 Scan Inc. Supp. 317.

Ltd v APRA (1997) 38 IPR 294 90 Telstra Corporation Ltd v Barry Cheng Kwok Chu WIPO Case No. D2000-0681 167 State of the Netherlands v Goldnames Inc. Supp. 149 F. Pty Ltd v Edwards Hot Water Systems (1985) 159 CLR 466 95 Sydney City Council v West (1965) 114 CLR 481 66 Sydney Markets Limited v Sydney Flower Market Pty Limited [2002] FCA 124 148 Szaeg v Minister for Immigration [2003] FMCA 258 55. v Bristile Ltd [2000] WASCA 210 207 The Comp Examiner Agency Inc. WIPO Case No. 7 Thornton v Shoe Lane Parking Station [1971] 2 QB 163 66. D2000-0802 166 TPI Holdings Inc. 25th Century Internet Publishers v Juris Inc. D2000-0124 170 Theophanous v Herald and Weekly Times Limited [1994] HCA 46 6. Minkle. v Stanley H Kaplan Educational Centre Ltd 84 Civ 1604 (MGC) (SDNY 1994) 144 The Salvation Army v Info-Bahn Inc. 72 Ticketmaster Corp. 3d 1368. 175 The Buddhist Society of Western Australia Inc. 215 (DDC January 1998) 228 Titan Industries Ltd v Prashanth Koorapati & Ors. D2000-0756 173 Telstra Corp. 97-3055 DDP (CD Cal 1997) 114 Timothy R McVeigh v William Cohen 983 F. 27 WR 706 154 Toyota Jidosha Kabushiki Kaisha v S & S Enterprises Ltd. D2000-1472 167 Transport Tyre Sales Pty Ltd v Montana Tyres Rims and Tubes Pty Ltd (1999) 93 FCR 421 113 Universal Music Australia Pty Ltd v Cooper [2005] FCA 1878 105 Universal Music Australia Pty Ltd v Cooper [2005] FCA 972 107 . 122 Step-Saver Data Sys Inc. 47 USPQ 2d (Fed Cir 1998) 119. D2000-0003 161. (CD Cal 1996) 144 The Ian Anderson Group of Companies Ltd v Denny Hammerton WIPO Case No. D2001-0434 161 Telstra Corporation Ltd v Nuclear Marshmallows WIPO Case No. 109 Ticketmaster Corporation v Microsoft Corporation No. WIPO Case No. v Tickets. 201 (CCED Pa 1853) 93 Stratton Oakmont Inc. 2d 91 (3d Cir 1991) 67 Steven J Caspi v Microsoft Network 323 NJ Super 118 (1999) 69 Sting v Michael Urvan WIPO Case No. 1995 WL 323710 (NY Sup Ct 1995) 208 SW Hart & Co. D2000-0596 170 Stowe v Thomas 23 F. Cas. D2001-0463 167 The Wiggles Touring Pty Ltd v Thompson Media Pty Ltd WIPO Case No. (1998) (Application 787 in action 179. D2000-0423 161 Telstra Corporation Ltd v David Whittle WIPO Case No. 56 Telaxis Communications Corp. 02/2003 177 The Princeton Review Management Corp. v William E. v Signature Financial Group Inc. WIPO Case No. 54 USPQ 2d 1344 (CD Cal 2000) 70. Delhi High Court) 157 Tourret v Cripps (1879) 48 LJ Ch 567.com Inc. v AFX Communications WIPO Case No. v Prodigy Services Co. D2000-0475 170 The National Office for the Information Economy v Verisign Australia Limited LEADR Case No. WIPO Case No.TABLE OF CASES xxiii Standard Chartered PLC v Purge IT WIPO Case No. v Wyse Tech 939 F. D2001-0520 169 State Street Bank and Trust Co.

xxiv

TABLE OF CASES

Universal Music Australia Pty Ltd v Sharman License Holdings Ltd [2005] FCA 1242 104 University of Melbourne v union melb WIPO Case No. DAU2004-0004 177 University of New South Wales v Moorehouse (1975) 133 CLR 1 98, 107 Victoria Park Racing v Taylor (1937) 58 CLR 479 235 Vita Food Products Inc. v Unus Shipping Co. [1939] AC 277 184 Vivendi Universal v Jay David Sallen WIPO Case No. D2001-1121 167, 168 Voth v Manildra Flour Mills Pty Ltd (1990) 65 ALJR 83 184, 214 Wagner v International Ry Co. 133 NE 437 at 437 (NY 1921) 236 Wal-Mart Stores Inc. v Richard MacLeod WIPO Case No. D2000-0662 167 Wal-Mart Stores Inc. v wallmartcanadasucks.com and Kenneth J Harvey WIPO Case No. D2000-1104 167 Wal-Mart Stores Inc. v Walsucks and Walmarket Puerto Rico WIPO Case No. D2000-0477 167 Ward Group Pty Ltd v Brodie & Stone Plc [2005] FCA 471 199 Ward v R [1980] HCA 11 191 Warner Bros Pictures v Majestic Pictures Corp. (1934) 70 F. 2d 310 93 Warnink v Townsend & Sons [1979] AC 731 151 Washington Post Co. v Total News Inc. 97 Civ 1190 (SDNY 1997) 114, 116 Webber v Jolly Hotels 977 F. Supp. 327 (D NJ 1997) 195 Wilkens v Iowa Insurance Commissioner (1990) 457 NW 2d 33, 34, 52 World Series Cricket Pty Ltd v Parish (1977) 16 ALR 181 252 Y Liu v Star City Pty Limited PR903625 [2001] AIRC 394 239 Yahoo Inc. v Akash Arosa [1999] FSR 931 157, 194 Yahoo! Inc and GeoCities v Data Art WIPO Case No. D2000-0587 161 Young v New Haven Advocate 315 F. 3d 256 (4th Cir 2003) 198, 199, 208 Zippo Manufacturing Co. v Zippo Dot Com Inc. 952 F. Supp. 1119 (WD Pa 1997) 194, 195, 196 Zoekallehuizen.nl v NVM (2006) 115

Table of statutes

Australian Constitution section 51 221 section 51(i) 28, 221 section 51(v) 221, 268 section 51(xiii) 221 section 51(xiv) 221 section 51(xviii) 90 section 51(xx) 28 section 51(xxi) 221 section 51(xxii) 221 section 51(xxiii) 222 section 51(xxiiiA) 222 section 51(xxix) 222 section 51(xxxix) 222 section 51(xxxvii) 222 section 52(ii) 222 section 96 222 section 122 28 Commonwealth Administrative Decisions Judicial Review Act 1977 (Cth) 328 Anti-Terrorism Act (No. 2) 2005 (Cth) 261–2 Anti-Terrorism Act 2004 (Cth) 260 Australian Capital Territory Government Service (Consequential Provisions) Act 1994 (Cth) 228 Australian Communications and Media Authority Act 2005 (Cth) 286 Australian Security Intelligence Organisation Act 1979 (Cth)
259

Amendment (Terrorism) Act 2003 (Cth) 259 Bills of Exchange Act 1909 (Cth) section 8 36 section 89 36 Broadcasting Services Act 1992 (Cth)
97, 323, 325, 366, 369

Part 11 326 Schedule 5 314, 322, 323 Schedule 7 273, 314, 318, 319,
323

clause 2 320 clause 11 320 clause 14 320 clause 43 322 clause 47(1) 320 clause 47(2) 321 clause 56(1) 321 clause 56(2) 321 clause 62(1) 321 clause 62(2) 321 Part 3 322 section 6 97 section 123(2)(a) 326 section 147 326 section 148 324 section 150 326 section 179(1) 327 section 180 327 Cheques Act 1986 (Cth) section 10 36 Circuit Layouts Act 1989 (Cth) 123,
124, 366

section 25(5) 259 section 4 259 Australian Security Intelligence Organisation Legislation

section 5 123, 124 section 11 123 section 17 123 section 19(3) 124 section 21(1) 124

xxv

xxvi

TABLE OF STATUTES

Commonwealth (cont.) section 22 124 section 23 124 section 25 124 section 27(1)–(2) 124 section 27(4) 124 Classification (Publications, Films and Computer Games) Act 1995 (Cth) 319 Communications Legislation Amendment (Content Services) Act 2007 (Cth) 318 Copyright Act 1968 (Cth) 90, 92,
96, 98, 105, 348, 365–74

Division 5 98 Part III 90 Part IV 91 Part VAA 102 Part VB 99 section 10 96, 97, 100, 365–70 section 13(2) 105 section 14 92, 93 section 24 91 section 31 102, 370–1 section 31(1) 91 section 31(1)(a)(i) and (b)(i) 93 section 31(1)(a)(iv) and (b)(iii)
97

section 115(5)–(8) 92, 102 section 116 92 sections 116AA–116AJ 101 sections 116AK–116AQ 99 section 116B 372 sections 116B–116D 100 section 116C 373 section 116CA 51 section 116D 374 sections 119–125 92 section 132AC 102 section 195AXI 101 section 196(3) 37 section 196AW 101 Copyright Amendment (Digital Agenda) Act 2000 (Cth)
106

Crimes Act 1914 (Cth) 268, 274,
275

Part VIIC 222 Division 5 225 section 3LA 274 Crimes Legislation Amendment (Telecommunications Offences and Other Measures) Act (No. 2) 2004 (Cth) 268, 270,
294

Criminal Code 1995 (Cth) 259, 268,
269, 270, 271, 283

section 31(1)(a)(vi)–(vii) 93 section 32 371 section 33 372 section 33(2) 91 section 33(3) 91 section 33(4) 91 section 39(1) 92 section 39A 99 section 39B 101 section 40 98 sections 40–42 98 section 43A 99 section 43A(1) 109 section 43B 99 section 101 105 section 101(1A)(a) 106 section 101(1A)(b) 106, 107 section 109A 101 section 111 101 section 112E 105, 108 section 115(2) 92

Dictionary 269, 270 Division 473 270 Division 474 270 Part 10.6 270, 295 section 72.1 258 section 80.1 258 section 100.1 259 section 100.1(1) 260 section 100.1(2) 260 section 100.1(2)e 260 section 100.1(3) 260 section 102.1 258 section 102.5 258 section 102.6 258 section 102.7 258 section 103.1 258 section 115.1 258 section 471.10 257 section 471.11 257 section 471.12 257

TABLE OF STATUTES

xxvii

section 473.1 272 section 474.1 270 section 474.2 270 section 474.5 271 section 474.6 271 section 474.7 271 section 474.8 271 section 474.9 271 section 474.10 271 section 474.11 271 section 474.14 271 section 474.15 271 section 474.16 271 section 474.17 271 section 474.18 271 section 474.19 272 sections 474.19–474.29
271

Cybercrime Act 2001 (Cth) 3, 268,
274

Data-Matching Program (Assistance and Tax) Act 1990 (Cth)
222, 225

Do Not Call Register (Consequential Amendments) Act 2006 (Cth)
291

Do Not Call Register Act 2006 (Cth)
291

Electronic Transactions Act 1999 (Cth) 27, 28, 56, 86, 297,
306

section 474.20 section 474.21 section 474.22 section 474.23 section 474.24
273

272 273 272 272 272,

section 474.27 273 section 474.29A 273 section 474.29B 32 section 477.1 269 section 477.2 269 section 477.3 269 section 478.1 269 section 478.2 270 section 478.3 270 section 478.4 270 Criminal Code Amendment (Anti-Hoax and Other Measures) Act 2002 (Cth)
257

Criminal Code Amendment (Offences Against Australians) Act 2002 (Cth) 259 Criminal Code Amendment (Suicide Related Material Offences) 2004 (Cth) 273 Criminal Code Amendment (Suppression of Terrorist Bombings) Act 2002 (Cth)
258, 265

Customs Act 1901 (Cth) 274

Explanatory Memorandum paragraph 49 49 section 1 29 section 2 29 section 3 27, 29 section 4 29 section 5 28, 29, 56, 82 section 6 28, 29 section 7 29 section 8 28, 29, 35 section 9 29 section 9(1) 37 section 9(1)(d) 48 section 9(2) 37 section 9(2)(d) 48 section 10 29, 39 section 10(1) 40, 80 section 10(1)(d) 48 section 11 29, 47 section 11(1)(e) 48 section 11(2)(e) 48 section 12 29 section 12(1) 52 section 12(2) 53 section 12(3) 54 section 12(4) 53 section 13 29, 61 section 14 29, 55, 56, 249 section 15 29 section 15(1) 62 section 15(2) 62 section 16 29 Electronic Transactions Regulations 2000 (Cth) 28 Schedule 1 33 Evidence Act 1995 (Cth) 304, 306

xxviii

TABLE OF STATUTES

Commonwealth (cont.) section 47 304 section 48(1) 305 section 51 304 section 71 86, 245 sections 160–2 245 section 161 245 Financial Transaction Reports Act 1988 (Cth) 294 Financial Transaction Reports Regulations 1990 (Cth) 294 Freedom of Information Act 1982 (Cth) 233 Health Records and Information Privacy Act 2002 (Cth) 226 Interactive Gambling Act 2001 (Cth)
278, 279

section 7C 225 section 13 223 section 13A 223 Security Legislation Amendment (Terrorism) Act 2002 (Cth)
258

Spam (Consequential Amendments) Act 2003 (Cth) 286 Spam Act 2003 (Cth) 4, 283, 284–9,
291, 314

Part 3 279 section 15 279 section 15A 279 Marine Insurance Act 1909 (Cth) section 27 37 section 28 37 Patents Act 1990 (Cth) 119 section 18 120, 121 section 18(1A) 122 Privacy Act 1988 (Cth) 4, 222, 223,
228, 283, 294

Information Privacy Principles
222

National Privacy Principles
223–5, 386–94

NPP 1 223 NPP 2 223 NPP 3 223 NPP 4 223 NPP 5 223 NPP 6 223 NPP 7 223 NPP 8 223 NPP 9 223 NPP 10 223 Schedule 3 223 section 14 222 section 6C 224, 225 section 6D 224 section 7 223 section 7B(3) 224 section 7B(4) 224

Part 4 286 Part 5 286 Part 6 286 Schedule 1 clause 2 285 clause 3 285 clause 4 285 Schedule 2 clause 2 288 clause 4 289 Schedule 3 286 section 16 284 section 16(1) 286, 287 section 16(5) 287 section 17 284 section 18 284 section 18(1) 285 section 18(2) 285 section 18(3) 285 section 18(4) 285 section 18(9) 285 section 20 289 section 21 289 section 22 289 section 41 286 Suppression of the Financing of Terrorism Act 2002 (Cth)
258, 265

Surveillance Devices Act 2004 (Cth)
256, 260–1

Telecommunications (Interception and Access) Act 1979 (Cth)
261, 274

section 117 274 section 5D(2)(d) 258 Telecommunications (Interception) Amendment (Stored Communications) Act 2004 (Cth) 261

TABLE OF STATUTES

xxix

Telecommunications Act 1997 (Cth) 270, 274, 286, 315,
366

Part 13 225 section 99(1) 319 Telecommunications Interception Legislation Amendment Act 2002 (Cth) 258 section 5(1)(c) 258 Telecommunications Service Provider (Mobile Premium Services) Determination 2005 (No. 1) (Cth) 319 Trade Marks Act 1995 (Cth) 111,
149

section 308C 275 section 308I 275 section 562AB 281 Criminal Records Act 1991 (NSW)
226

Defamation Act 2005 (NSW) Part 3 207 section 8 213 section 11 202 section 26 205 section 32 208 section 32(3)(f)(i) and (ii)
206

Electronic Transactions Act 2000 (NSW) 27, 28, 32,
297

section 6 111 section 10 113 section 14 113 section 17 110 section 20 111 section 27 111 section 120 112–13, 147 section 120(3) 146 section 120(3)(4) 113 section 120(3)(d) 149 section 120(4) 146 section 146 118 Trade Practices Act 1974 (Cth) 72,
112, 117, 159, 162, 193, 250, 251 Part V 115 section 52 117, 118, 157, 158, 159, 251 section 53 117, 157, 251 section 53(c) 159 section 53(d) 159 section 75AZC 158

Part 2A 63, 248 section 1 29 section 2 29 section 3 29 section 4 29 section 5 29, 56, 82 section 6 28, 29 section 7 29, 35 section 8 29 section 8(1) 37 section 8(2) 37 section 9 29, 39 section 9(1) 40, 80 section 10 29, 47 section 11 29 section 11(1) 52 section 11(2) 53 section 11(3) 54 section 11(4) 53 section 12 29, 55, 56, 61,
249

New South Wales Access to Neighbouring Land Act 2000 (NSW) section 16 226 section 26 226 Contracts Review Act 1980 (NSW)
72

Conveyancing Act 1919 (NSW) section 54A 36, 39 Crimes Act 1900 (NSW) section 308 275 sections 308–308H 276

section 13 29 section 14 29 section 14(1)6 62 section 14(2) 62 section 15 29 Electronic Transactions Regulations 2007 (NSW) regulation 4 33 regulation 5(f) 33 regulation 7 33 Evidence Act 1995 (NSW) 304 section 47 304

xxx

TABLE OF STATUTES

New South Wales (cont.) section 48(1) 305 section 51 304 section 71 86, 245 sections 160–2 245 section 161 245 Fair Trading Act 1987 (NSW) 159 Freedom of Information Act 1989 (NSW) 226, 233 Health Records and Information Privacy Act 2002 (NSW) 226 Limitation Act 1969 (NSW) 32,
45

Defamation Act 2005 (Qld) Part 3 207 section 8 213 section 11 202 section 26 205 section 32 208 section 32(3)(f)(i) and (ii)
206

Electronic Transactions (Queensland) Act 2001 (Qld) 27, 28,
297

section 14B 210 section 54 32 section 56A 210 Listening Devices Act 1984 (NSW)
226

Privacy and Personal Information Protection Act 1998 (NSW)
226

Privacy Committee Act 1975 (NSW)
222, 226

State Records Act 1998 (NSW) 226 Telecommunications (Interception) (New South Wales) Act 1987 (NSW) 226 Workplace Surveillance Act 2005 (NSW) 226, 238 section 10 239 section 25 238 Workplace Video Surveillance Act 1998 238 Queensland Criminal Code 1899 (Qld) 294 section 228 276 section 359A–359F 281 section 398 294 section 408C 294 section 408C(1) 294 section 408D 275 section 408D(2) 275 section 408D(3) 275 section 408E 275, 276 section 427(1) 294 section 441 294 Criminal Law (Rehabilitation of Offenders) Act 1986 (Qld)
226

Schedule 1 clause 16 33 Schedule 2 56 section 1 29 section 2 29 section 3 29 section 4 29 section 5 29 section 6 29, 82 section 7 28, 29 section 8 29, 35 sections 9–13 29 section 11 37 section 12 37 section 14 40, 80 sections 14–15 29, 39 sections 16–18 29, 47 section 19 52 sections 19–21 29, 53 section 20 53 section 20(3) 54 sections 22–25 29 section 23 55, 249 section 24 56 section 25 61 section 26 29 section 26(1) 62 section 26(2) 62 section 27 29 Evidence Act 1977 (Qld) section 95 301 section 95(6) 303 Freedom of Information Act 1992 (Qld) 226, 233 Invasion of Privacy Act 1971 (Qld)
226

Invasion of Privacy Regulations 1998 (Qld) 226

TABLE OF STATUTES

xxxi

Legislative Standards Act 1992 (Qld) section 4(5) 33 Limitation of Actions Act 1974 (Qld) section 10AA 210 Limitation of Actions Act 1974 (Qld) section 32 210 Police Powers and Responsibilities Act 2000 (Qld) 226 Property Law Act 1974 (Qld) section 10 36 section 59 36, 39 Public Records Act 2002 (Qld) 226 Whistleblowers Protection Act 1994 (Qld) 226 South Australia Criminal Law Consolidation Act 1935 (SA) Part 5A 294 section 19AA 281 section 144B 294 section 144C 294 Defamation Act 2005 (SA) Part 3 207 section 8 213 section 11 202 section 24 205 section 30 208 section 30(3)(f)(i) and (ii) 206 Electronic Transactions Act 2000 (SA)
27, 28, 297

section 14 29 section 14(1) 62 section 14(2) 62 section 15 29 Electronic Transactions Regulations 2002 (SA) regulation 4 33 regulation 5 33 Evidence Act 1929 (SA) section 34C 302 section 55B 302 Freedom of Information Act 1991 (SA) 227, 233 Law of Property Act 1936 (SA) section 26 39 Limitation of Actions Act 1936 (SA) section 37(1)(2) 210 Listening and Surveillance Devices Act 1972 (SA) 227 State Records Act 1997 (SA) 227 Summary Offences Act 1953 (SA) section 44 275 sections 44–44A 276 Telecommunications (Interception) Act 1988 (SA) 227 Tasmania Annulled Convictions Act 2003 (Tas)
227

section 1 29 section 2 29 section 3 29 section 4 29 section 5 29, 56, 82 section 6 28, 29 section 7 29, 35 section 8 29, 39 section 8(1) 37, 40, 80 section 8(2) 37 section 9 29 section 10 29, 47 section 11 29 section 11(1) 52 section 11(2) 53 section 11(3) 54 section 11(4) 53 section 12 29 section 13 29, 55, 56, 61, 249

Archives Act 1983 (Tas) 227 Conveyancing Law of Property Act 1884 (Tas) section 36 39 Criminal Code 1924 (Tas) section 192 281 section 257A–257F 276 section 257C 275 section257D 275 Defamation Act 2005 (Tas) Part 3 207 section 8 213 section 11 202 section 20A(1)(2) 210 section 26 205 section 32 208 section 32(3)(i) and (ii) 206 Electronic Transactions Act 2000 (Tas) 27, 28, 297 section 1 29 section 2 29

56. 297. 55. 35 section 6 29 section 6(1) 37 section 6(2) 37 section 7 29. 82 section 4 29 section 5 29 section 6 28. 29 section 7 29. 55. 348–56 Personal Information and Protection Act 2004 (Tas) 227 Telecommunications (Interception) Tasmania Act 1999 (Tas) 227 section 1 29 section 2 29 section 3 29. 261 . 39 section 7(1) 40. 226 Victoria Crimes Act 1958 (Vic) section 21A 281 section 247–247H 276 section 247B 275 Defamation Act 2005 (Vic) Part 3 207 section 8 213 Instruments Act 1958 (Vic) section 126 39 Limitation of Actions Act 1958 (Vic) section 23B 210 Public Records Act 1973 (Vic) 226 Surveillance Devices Act 1999 (Vic) 225. 47 section 9 29 section 9(1) 52 section 9(2) 53 section 9(3) 54 section 9(4) 53 section 10 29 section 11 29. 35 section 8 29 section 8(1) 37 section 8(2) 37 section 9 29. 233 Listening Devices Act 1991 (Tas) 227 section 11 202 section 26 205 section 32 208 section 32(3)(i) and (ii) 206 Electronic Transactions (Victoria) Act 2000 (Vic) 27. 226. 56. 226 Information Privacy Act 2000 (Vic) 225. 80 section 8 29. 61. 56. 82 section 4 28. 28. 80 section 10 29. 47 section 11 29 section 11(1) 52 section 11(2) 53 section 11(3) 54 section 11(4) 53 section 12 29. 29 section 5 29. 233 Health Records Act 2001 (Vic) 225. 39 section 9(1) 40. 61.) section 3 29.xxxii TABLE OF STATUTES Tasmania (cont. 249 section 13 29 section 14 29 section 14(1) 62 section 14(2) 62 section 15 29 Electronic Transactions (Victoria) Regulations 2000 regulation 5 33 Evidence Act 1958 (Vic) section 55 303 Freedom of Information Act 1982 (Vic) 226. 249 section 12 29 section 12(1) 62 section 12(2) 62 section 13 29 section 14 29 Electronic Transactions Regulations 2001 (Tas) regulation 4(a) 33 Evidence Act 2001 (Tas) 304 section 47 304 section 48(1) 305 section 51 304 section 71 245 sections 160–162 245 section 161 245 Freedom of Information Act 1991 (Tas) 227. 56.

TABLE OF STATUTES xxxiii Telecommunications (Interception) (State Provisions) Act 1988 (Vic) 226 Terrorism (Community Protection) Act 2003 (Vic) 262 Western Australia Criminal Code Act 1913 (WA) section 338E 281 section 440A 275. 47 . 29 section 7 29 section 8 29. 47 section 11 29 section 11(1) 52 section 11(2) 53 section 11(3) 54 section 11(4) 53 section 12 29 section 13 29. 297 section 1 29 section 2 29 section 3 29 section 5 29. 82 section 7 29. 61. 82 section 6 28. 80 section 10 29. 50 section 8(1) 37 section 8(2) 37 section 9 29. 56. 35 section 8 29 section 8(1) 37 section 8(2) 37 section 9 29. 233 Limitation Act 2005 (WA) section 15 210 section 40(3) 210 Sale of Goods Act 1895 (WA) section 4 37 Spent Convictions Act 1988 (WA) 227 State Records Act 2000 (WA) 227 Statute of Frauds 1677 (Imp) (WA) 39 Surveillance Devices Act 1998 (WA) 227 Telecommunications (Interception) Western Australia Act 1996 (WA) 227 Australian Capital Territory Civil Law (Property) Act 2006 (ACT) section 201 39 Civil Law (Wrongs) Act 2002 (ACT) Part 9.3 207 section 120 213 section 123 202 section 136 205 section 139C 208 section 139C(3)(f)(i) and (ii) 206 Crimes Act 1900 (ACT) section 35(2)(f)(g)(h) 281 Criminal Code 2002 (ACT) section 412–421 276 section 415 275 section 416 275 Electronic Transactions Act 2001 (ACT) 27. 39 section 9(1) 40. 80 section 10 29. 28. 56. 297 dictionary 56 section 1 29 section 3 29 section 4 29 section 5 29. 39 section 9(1) 40. 28. 249 section 14 29 section 14(1) 62 section 14(2) 62 section 15 29 Electronic Transactions Regulations 2003 (WA) regulation 3 33 regulation 5 33 Evidence Act 1906 (WA) 303 section 73A(1) 303 section 73A(2) 303 section 73A(3) 304 section 79C 303 Freedom of Information Act 1992 (WA) 226. 276 Defamation Act 2005 (WA) Part 3 207 section 8 213 section 11 202 section 26 205 section 32 208 section 32(3)(f)(i) and (ii) 206 Electronic Transactions Act 2003 (WA) 27. 55.

) section 11 29 section 11(1) 52 section 11(2) 53 section 11(3) 54 section 11(4) 53 section 12 29 section 13 29. 56. 78. 297 Preamble 297 section 4 36. 42. 297 section 17 36 Trade Marks Act 1994 (UK) 149 section 10 147 . 55. 61. 29 section 7 29. 30 section 91(10) 30 Licensing Act of 1662 (Imp) 90 Statute of Anne 1702 (Imp) 90 Statute of Frauds 1677 (Imp) 36. 44. 249 section 14 29 section 14(1) 62 section 14(2) 62 section 15 29 Freedom of Information Act 1989 (ACT) 233 Limitation Act 1985 (ACT) section 21B(1)(2) 210 Northern Territory Criminal Code Act 1983 (NT) section 125A 276 section 125B 276 section 189 281 section 222 276 section 276–276F 276 section 276B 275 section 276E 276 Defamation Act 2006 (NT) Part 3 207 section 7 213 section 10 202 section 23 205 section 29 208 section 29(3)(f)(i) and (ii) 206 section 11 29 section 11(1) 52 section 11(2) 53 section 11(3) 54 section 11(4) 53 section 12 29 section 13 29. 30 section 7(2)(3) 30 Freedom of Information (Scotland) Act 2002 (UK) 233 Freedom of Information Act 2000 (UK) 233 Land Registration Act 2002 (UK) 29. 56. 47 Part 8 29 section 91 29. 30 section 1 29 section 2 29 section 3 29 section 4 29 section 5 29. 249 section 14 29 section 14(1) 62 section 14(2) 62 section 15 29 Electronic Transactions (Northern Territory) Regulations regulation 2 33 Evidence Act (NT) section 26D 302 Information Act 2002 (NT) 227 Law of Property Act 2000 (NT) section 62 39 Limitation Act 2005 (NT) section 12(2)(b) 210 section 44A(2) 210 Imperial Civil Evidence Act 1995 (UK) 306 Electronic Transactions (Northern Territory) Act 2000 (NT) 27. 42. 39 section 9(1) 40. 28. 82 section 6 28. 61. 39. 297 section 8 307 Electronic Communications Act 2000 (UK) 29.xxxiv TABLE OF STATUTES Australian Capital Territory (cont. 35 section 8 29 section 8(1) 37 section 8(2) 37 section 9 29. 80 section 10 29. 80. 55. 56. 75. 78.

149 . 82 sections 5–6 29 section 6 28 section 7 29 section 8 29. 35. 34. 63. 82. 35 sections 9–13 29 section 10(1) 56 section 11 57 sections 12–13 61 section 14 29. 53 sections 25–26 29 sections 26–27 53 sections 28–29 29 section 29 47. 48 section 30 63 section 36 29 Electronic Transactions Regulations 2003 (NZ) 28 Evidence Act 2006 (NZ) 306 section 137(1) 306 section 137(2) 306 Subpart 8 302 Layout Designs Act 1994 (NZ) 123 Limitation Act 1950 (NZ) section 4 210 Official Information Act 1982 (NZ) 233 Privacy Act 1993 (NZ) 240 Trade Marks Act 2002 (NZ) 111 section 89(1)(d) 147.TABLE OF STATUTES xxxv Canada Electronic Transactions Act 2001 (Canada) 51 section 4 51 Uniform Electronic Commerce Act 1999 (Canada) 52 Europe Directive 1999/93/Ec of the European Parliament and of the Council 86 Directive 96/9/EC of the European Parliament 115 European Patent Convention article 52(1) 120 Privacy and Electronic Communications Directive 2003 290 India Indian Evidence Act 1872 (India) 307 section 254 277 Crimes Amendment Act 2003 (NZ) 276 Electronic Transactions Act 2002 (NZ) 28. 34 section 18 39 sections 18–21 29 section 22 45 sections 22–24 29 section 23 46 section 23(1)(b) 46 section 24 46 section 25 52. 306 section 22 307 section 61 307 section 62 308 section 63 308 section 64 307 section 65 307 Information Technology Act 2000 (India) 179 Right to Information Act 2005 (India) 233 Trade Marks Act 1999 (India) section 2(zb) 150 section 29 147 New Zealand Copyright Act 1994 (NZ) 90 section 16 91 section 22 91 section 42 98 section 43 98 section 176 98 Crimes Act 1961 (NZ) 276 Part 11 281 section 248 277 section 249 276 section 250(1) 277 section 250(2) 277 section 251 277 section 252 277 section 253 277 Schedule 34 section 1 29 section 2 29 section 3 29 section 4 29 section 5 46.

83. 148 International Conventions Convention for the Suppression of Unlawful Acts against the Safety of Civil Aviation 1971 264 section 1129 148 Business Method Patent Improvement Act (US) 120 CAN-SPAM Act 2003 (US) 290 Communications Decency Act 1996 (US) 272. 51 section 5 51 section 5(b) 51 section 14 73 Uniform Single Publication Act (US) 212 section 27(3)(d) 149 United States Anti-Cybersquatting Consumer Protection Act 1999 (US) 147.) Unsolicited Electronic Messages Act 2007 (NZ) 283.xxxvi TABLE OF STATUTES New Zealand (cont. 84 Trade Marks Act 1998 (Singapore) 149 Telecom Reform Act 1996 (US) 14 Trademark Dilution Act 1995 (US) 147 Uniform Electronic Transactions Act 1999 (US) 26. 29. 257 Privacy Act 1974 (US) 233. 241. 241 section 552a 241 Single Publication Act (Idaho) section 6-702 212 Convention on Offences and Certain Other Acts Committed on Board Aircraft 1963 (Tokyo Convention) 263 Convention on the Physical Protection of Nuclear Material 1980 (Nuclear Materials Convention) 265 Convention on the Prevention and Punishment of Crimes Against Internationally Protected Persons 1973 264 Council of Europe Convention on Cybercrime 268. 289 section 32 290 section 45 290 Singapore Electronic Transactions Act 1998 (Singapore) 44. 82 section 2 44. 284. 317 section 203(c)(1) 209 Computer Matching and Privacy Protection Act 1988 (US) 241 Convention for the Suppression of Unlawful Acts against the Safety of Maritime Navigation 1988 (Rome) 264 Convention for the Suppression of Unlawful Seizure of Aircraft 1970 (Hague Convention) 263 Copyright Act 1976 (US) 102 section 107 103 Electronic Signatures in Global and National Commerce Act 2000 (US) 51 section 101(c)(1)(C)(ii) 51 Federal Uniform Rules of Evidence 307 article X rule 1001 307 rule 1002 307 rule 1003 307 Freedom of Information Act 1966 (US) 233 Lanham (Trademark) Act (US) 148 section 43 148 PATRIOT Act 2001 (US) 235. 276 European Patent Convention article 52(1) 120 International Convention against the Taking of Hostages 1979 (Hostages Convention) 265 International Convention for the Marking of Plastic Explosives for the Purposes of Detection 1991 (Montreal) 266 International Convention for the Suppression of Terrorist .

49. 84. 358 article 5bis 35. 331. 332. 40. 45. 232 artilce 19 196 Universal Declaration of Human Rights 217. 232 article 17 197. 34. 232 article 12 232 . 44. 358 article 3 358 article 4 358 article 5 31. 31. 204. 305. 359 article 9 306. 36. 1997) 265 International Convention for the Suppression of the Financing of Terrorism 1999 (New York) 265 Optional Protocol on the Sale of Children. 34. 51. 359 article 8 63. 316 United Nations International Covenant on Civil and Political Rights (ICCPR) 196. 331. 62. 82. 54. 334. 49. 358 articles 5–15 27 article 6 359 article 7 333. Child Prostitution and Child Pornography (UNICEF) 277 Protocol for the Suppression of Unlawful Acts Against the Safety of Fixed Platforms Located on the Continental Shelf 1988 (Rome) (Supplementary to the Convention for the Suppression of Unlawful Acts Against the Safety of Maritime Navigation 1988 (Rome)) 264 Supplementary Protocol for the Suppression of Unlawful Acts of Violence at Airports Serving International Civil Aviation 1988 (Montreal) 264 UNCITRAL Model Law of Electronic Commerce 1996 9. 25–7. 48. 48. 64. 333. 63. 49. 86. 334. 278. 86. 35. 357 article 2 306. 29. 360 article 9(2) 306 article 10 360 article 11 35. 360 article 12 360 article 13 361 article 14 361 article 15 362 article 16 363 article 17 363 Official Guide 26.TABLE OF STATUTES xxxvii Bombings (New York. 28. 36. 35. 56. 333 UNCITRAL Model Law of Electronic Signatures 82. 357–64 article 1 31. 332. 40. 334 article 2 82 United Nations Convention on the Rights of the Child 277.

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Public key cryptology was invented in response to security concerns and has revolutionised electronic commerce. larger choice. sending electronic communications to 1 . most notably the internet and cyberspace. There are also questions regarding jurisdiction. including text. the convenience of shopping from the computer and enormous efficiencies. sound and images. the expression ‘electronic commerce’ is typically used in connection with the expansion of commerce using computers and modern communications. when the first contract was entered into using the telegraph or telephone. standards. taxation. However. The advantages of electronic commerce to commercial parties include ease of access. Communications are now relatively secure: digital signatures or certificates permit the authentication of the sender of a message or of an electronic commerce product. anonymous browsing of products. trade law and many other issues. This involves transactions over the internet. The disadvantages include the potential for invasion of privacy and security risks. Security is of paramount importance in electronic commerce. electronic commerce began in the mid-1800s. plus electronic funds transfers and Electronic Data Interchange (EDI). protection of intellectual property. Nevertheless.1 The law of electronic commerce Electronic commerce refers to all commercial transactions based on the electronic processing and transmission of data. The development of security protocols has aided the rapid expansion of electronic commerce by substantially reducing commercial risk factors. acceptance of electronic products and services has grown substantially. On one level. Whether it is undertaking a commercial transaction on the World Wide Web. This book addresses legal issues relating to the introduction and adoption of various forms of electronic commerce.

infrastructure and contexts.pdf. It necessitates understanding terrestrial norms.sclqld. The majority of legal problems arising through the use of electronic commerce can be answered satisfactorily by the application of standard legal principles. Justice Fryberg. rights. cyberspace gives rise to unique and unusual circumstances. But such development was at a snail’s pace compared with the eruption of the law of electronic commerce over the last two decades. surveillance and domain name usage and disputes. Parties must consider the risks of electronic commerce. . In the 18th and 19th centuries there may have been a similar opportunity to observe principles evolving. even if this challenges such foundations of society as sovereignty and human rights. (2000) 15 Berkeley Tech L J 1145. 3 ‘Against cyberlaw’. However. It is an exciting time to be charting the course and watching as legislators. there are legal considerations. and as principles of equity matured. Electronic commerce law An examination of the law of electronic commerce must begin with a fundamental understanding of the law and its role in society as it has evolved over the centuries. Contract law.2 although he acknowledged that he had completed a keynote address on precisely that topic.org. international agreements and a plethora of cases before the courts to resolve myriad questions. if the parties are in different countries from the servers. asked. privileges and relationships that are not adequately dealt with by traditional law. which jurisdiction and which law governs a dispute between parties. email communications. The expression ‘electronic commerce law’ is used to describe all changes and additions to the law that are a result of the electronic age.2 LAW OF ELECTRONIC COMMERCE enter into commercial arrangements.au/judgepub/2003/fry070403. This has necessitated legislation. for example. merchants and the populace wrestle with this new epoch. and that cyberspace ‘is a delightful new playground for old games’: 1 Justice of the Supreme Court of Queensland.1 in an address to the Australian Conference on the Law of Electronic Commerce. as there were new developments in relation to consideration (in contract law) and the postal acceptance rule (also in contract law). 2 Supreme Court of Queensland publications: archive. This book addresses intellectual property. ‘Is there such a thing as Electronic Commerce Law? I suggest there is not’. electronic banking and cyberspace generally. These principles must be applied to new circumstances. all apply to the internet. social behaviour and the application of the rule of law. Joseph Sommer3 argued that ‘cyberlaw’ was non-existent as a separate body of law. commercial law and consumer law. downloading material subject to copyright or privacy concerns about our digital personas. courts. cybercrime. whether electronic writing and signatures are equivalent to paper writing or wet ink signatures.

the US law firm of Miller. or with prizes at horse shows. Those who scorned words like ‘cyberlaw’ and ‘cybercrime’ perhaps winced at the introduction of the Australian Cybercrime Act 2001 (Cth). forms a unique area of legal discourse. and hard-wired censors’. others deal with people kicked by horses. 8 See also James Boyle. The law of electronic commerce has increasingly become a distinct class of study. any more than there was reason to teach the ‘law of the horse’. crystallizing someone’s idea of a future that will never be. Legislation has been deemed necessary for several cyber issues. social norms and mores. corporate and equine matters’. Easterbrook argued that cyberlaw is unimportant because it invokes no first principles.6 He made reference to the comment of a former Dean of the University of Chicago Law School that a course in the law of the horse was not offered: ‘Lots of cases deal with sales of horses. dedicated monographs and courses in every law school. at least. (1996) U Chi Legal F 207. He argued that any lesson about cyberspace requires an understanding of the role of law. would ‘illuminate the entire law’. sovereignty. with legal specialists. still more deal with the licensing and racing of horses. (1999) 113 Harv L Rev 501. because neither. At worst. 6 ‘Cyberspace and the law of the horse’. 7 Interestingly. it can lock us into bad law.7 Judge Easterbrook argued that there was no reason to teach the ‘law of cyberspace’. it is dangerous to pretend that it exists. will be valuable in understanding and assessing the role of law everywhere. and that in creating a presence in cyberspace. Easterbrook and Lessig’s disquisitions are now dated by a decade in a field which has advanced more quickly than any other field of law. By analogy he proclaimed that cyberlaw did not exist.8 In his article ‘The law of the horse: What cyberlaw might teach’. Understanding how the law applies in cyberspace in conjunction with demands. or with the care veterinarians give to horses. Through a series of examples he demonstrated that cyberlaw or electronic commerce law. 5 Now Chief Judge of the US Court of Appeals for the Seventh Circuit. since law tends to evolve through an inductive accretion of experience. 9 ‘The law of the horse: What cyberlaw might teach’. Lessig referred to privacy and spam in cyberspace. A lust to define the future can be very dangerous. Griffin and Marks advertises that it specialises in ‘commercial. he suggested. ‘Foucault in cyberspace: Surveillance. It is much safer to extract first principles from a mature body of law than to extract a dynamic body of law from timeless first principles. and the rule of cyberspace.’ Nevertheless there is no discrete body of horse law.4 Judge Frank Easterbrook5 initiated the debate with his article ‘Cyberspace and the law of the horse’. An overly technological focus can create bad taxonomy and bad legal analysis. . we must all make choices about whether the values we embed there will be the same values we espouse in our real space experience. Traditional laws proved inadequate. Lawrence Lessig9 responded to Easterbrook’s assertions. however described. A lust to define the law of the future is even worse. 177.THE LAW OF ELECTRONIC COMMERCE 3 [N]ot only is ‘cyberlaw’ nonexistent. especially when we cannot even agree on the present. (1997) University of Cincinnati Law Review 66. 4 Ibid.

In response to this the Australian Privacy Act 1988 (Cth) was overhauled in 2000 to make the private sector accountable. Censorship laws for print and television are ineffective for online materials. Domain names are valuable business identifiers. traded in the millions of dollars and subject to numerous disputes. South Korea and the US. legally and otherwise. for instance. but the law must address the easy reach of such material in the digital age. in an international context. a defamation statement can be published continuously worldwide 24 hours a day. Electronic commerce by its nature does not recognise borders and it raises questions regarding security of transactions. standards and protection. . in a manner not contemplated until recently. Online defamation. Nations have different ages at which a person is no longer regarded as a child. but with global reach. Now. The courts have had to reconsider the single publication rule. such as peer-to-peer file sharing (music and videos in particular). with recommendations to expand privacy laws so that they deal with technological developments. theft of intellectual property and identity theft. freedom of speech issues arise with terrorism issues (plans to make a bomb) and suicide information. unauthorised copying or distribution of computer programs. is unlike the static occurrences. in an attempt to provide remedies. Evidentiary issues arise in relation to digitising paper documents and printing out electronic documents. What is electronic writing. credit card fraud. Child pornography. See Chapter 16. computer sabotage.4 LAW OF ELECTRONIC COMMERCE necessitating legislation on computer-related crime. spyware and censorship are issues on which laws vary dramatically internationally. suicide materials. Most national domain name administrators have introduced dispute resolution procedures. The Australian Law Reform Commission (ALRC) is currently undertaking a further review. The internet raises a range of intellectual property issues. The courts have dramatically expanded the tort of passing off.10 The digitalisation of data results in real privacy concerns. bank card fraud. The courts have formed new approaches. terrorism. digital rights management. resulting in legislation and international agreements. and yet each website is typically available globally. time shifting and format shifting. and an electronic signature? The range of issues related to electronic contracting has resulted in the Electronic Transactions Acts internationally. Spam has become a real economic waste for virtually all business. computer forgery. 10 For example the Spam Act 2003 (Cth) and the Memoranda of Understanding between Australia. unauthorised access to computer systems. in ways that in other contexts may be considered draconian. and the applicability of local laws to a website intended for another jurisdiction. Conflict of laws principles in cyberspace have been inadequately served by traditional principles established over centuries. cyber stalking.

36 million or almost 78 per cent of total non dial-up subscribers were connected this way). Similar rates were seen in New South Wales (63% total and 42% broadband).34 million. Broadband was used by 46 per cent of homes in major cities and 24 per cent in very remote Australia. with 75% of all homes connected and 53% of these on broadband connections. while dialup dropped by 16 per cent. In 2006. Households with an income of $2000 or more per week were three times more likely to have broadband than households on less than $600 per week. 66 per cent of homes in major cities had internet access. Non dial-up subscribers increased by 16 per cent between September 2006 and March 2007. Connections with download speeds of 1. the International Telecommunications Union and the International Organisation for Standardisation. The lowest connection rate was in Tasmania (55% and 28%). the Asia-Pacific Economic Cooperation (APEC). The growth in non dial-up was driven mainly by household subscribers. Families with children under 15 (or dependant students) were three to four times more likely to have internet access than other families. disparate and coherent body of law. Queensland (64% and 41%) and Western Australia (65% and 41%). Home internet access across Australia reached 67 per cent in 2007. compared with 60 per cent at the end of September 2006. . Unemployed people 11 Other bodies include the Free Trade Agreement of the Americas. the International Chamber of Commerce (ICC).11 The law of electronic commerce (or cyberlaw) has emerged as a new. Internet use in Australia According to the Australian Bureau of Statistics (ABS).43 million active internet subscribers in Australia. as at the end of the March quarter 2007.09 million. comprised of 761 000 business and government subscribers and 5. The number of non dial-up subscribers was 4.THE LAW OF ELECTRONIC COMMERCE 5 Many international organisations have spent considerable time and resources on resolving legal issues and difficulties in electronic commerce: the UN Commission on International Trade Law (UNCITRAL). there were 6. the Organisation for Economic Cooperation and Development (OECD) and the World Trade Organization (WTO) are some examples. Non dial-up subscribers represented 67 per cent of total internet subscribers in Australia at the end of March 2007. 12 In 2006 the ACT had the highest connection rate.56 million (there were 1. People not in the labour force were 18 per cent less likely to have broadband than those in the labour force. up from 35 per cent in 2001.12 The ABS report also found that income and education were key factors in people’s internet access. Digital Subscriber Line (DSL) continued to be the dominant access technology used by non dial-up subscribers (3. See Chapter 19. Victoria (63% and 42%).09 million at the end of September 2006). the number of dial-up subscribers was 2.5 Mbps or greater had increased by 43 per cent by March 2007 to 1. People in low-skill occupations were about a quarter less likely to have broadband than those with higher skills.67 million household subscribers. compared with 42 per cent for very remote Australia.

the terms conventionally used to refer to the materials that are transmitted in this way are a ‘document’ or a ‘web 13 Dow Jones v Gutnick [2002] HCA 56. The court considered defamation on the World Wide Web and whether it was appropriate for the Supreme Court of Victoria to exercise jurisdiction over a US-based website. 16 Dow Jones v Gutnick [2002] HCA 56. institutions and method. Part Three. regarding ‘the unusual features of publication on the internet and the World Wide Web’. It enables a document to be stored in such a way on one computer connected to the Internet that a person using another computer connected to the Internet can request and receive a copy of the document . subject to the Constitution and statute. especially Brennan J at para 4. in particular. . .15 In a joint majority judgment Gleeson CJ. Sydney. The nature and essence of the common law makes it amenable to development. Judicial consideration in Australia The High Court of Australia has had few opportunities to consider the impact of electronic commerce. Pearson Education Australia. The majority accepted that the internet is ‘a telecommunications network that links other telecommunication networks . This was the first real opportunity for the court to consider its role in law making and the common law in the context of cyberspace and electronic commerce. cyberspace and the operation of the internet. Dow Jones v Gutnick13 in 2002 was one such opportunity. . 14 See Theophanous v Herald and Weekly Times Limited [1994] HCA 46. para 13. development is an integral part of the common law and of our socio-legal structure. McHugh. Hedigan J. 15 For a considered and valuable discourse see Russell Hinchy. . a coherence-based incremental method or policybased. Indigenous households are about half as likely to have broadband as non-indigenous households. The World Wide Web is but one particular service available over the Internet. . .6 LAW OF ELECTRONIC COMMERCE were 12 per cent less likely to have broadband than employed people. among an unprecedented number of people using an unprecedented number of devices [and] among people and devices without geographic limitation’. [that] enables inter-communication using multiple data-formats . See also D’Orta-Ekenaike v Victorian Legal Aid [2005] HCA 12. [2002] 1 AC 615. Gummow and Hayne JJ accepted the evidence before the judge at first instance. (2005) 223 CLR 1 and Arthur J S Hall & Co v Simmons [2000] UKHL 38. Nevertheless the majority took the opportunity to define a broad range of internet terms: 14. scholars and commentators debate the length and breadth of acceptable developments using various forms of legal reasoning to justify their individual approaches.14 The judiciary. Whether the approach is principle-based. 2008. The Australian legal system: History.16 The majority expressed concern regarding the lack of evidence adduced to reveal what electronic impulses pass or what electronic events happen in the course of passing or storing information on the internet. .

to be reconsidered in the light of this unique medium of instant worldwide communication’. and social data and public consultation. para 77.20 Of this passage Brennan J. cohesion and precedent in an analytical ballet of deductive. valid applicable legislation. in Theophanous v Herald and Weekly Times Limited. Alfred A Knopf. quoting Lord Bingham of Cornhill. . The spirit of liberty: Papers and addresses of Learned Hand. On the one hand. Nevertheless.’22 To varying degrees the judiciary acknowledges its role in the law-making process. the pros and cons of imposing retrospective liability on persons. 19 Dow Jones v Gutnick [2002] HCA 56.19 As they have recognised the enormity of the impact of the internet as a revolutionary communications giant. Oxford. This process is conventionally referred to as ‘uploading’.18 Most significantly. 20 Hand. as Kirby J pointed out.21 remarked. 18 Dow Jones v Gutnick [2002] HCA 56. 21 [1994] HCA 46. courts all over the world have been forced to reconsider basic principles. many factors would need to be balanced: the economic implications of any change. In the same case Kirby J was more philosophical in discussing the ramifications of technological developments. 1960. ‘Other judges find the call to reform more urgent. reform is the purvey of government. The originator of a document wishing to make it available on the World Wide Web arranges for it to be placed in a storage area managed by a web server. A computer that makes documents available runs software that is referred to as a ‘web server’. Oxford University Press. balancing consistency. . 2001. When the server delivers the document in response to the request the process is conventionally referred to as ‘downloading’. the common law is the 17 Matthew Collins. we accept the verdict of the past until the need for change cries out loudly enough to force upon us a choice between the comforts of further inertia and the irksomeness of action. para 5. The law of defamation and the internet. . 22 [1994] HCA 46. courts have reversed long-held notions of common law principle when ‘stimulated by contemporary perceptions of the requirements of fundamental human rights’.THE LAW OF ELECTRONIC COMMERCE 7 page’ and a collection of web pages is usually referred to as a ‘web site’. Kirby J appropriately quoted noted US jurist Billings Learned Hand: The respect all men feel in some measure for customary law lies deep in their nature.). inductive and abductive reasoning. it is not the primary role of the courts. who said that the impact of the internet on the law of defamation will require ‘almost every concept and rule in the field . 15. a computer that requests and receives documents runs software that is referred to as a ‘web browser’. 3rd edn.17 In any reformulation of the common law. ‘The contribution of an independent judiciary to civilisation’. in Irving Dillard (ed. A person wishing to have access to that document must issue a request to the relevant server nominating the location of the web page identified by its ‘uniform resource locator (URL)’. New York. Kirby J continued. paras 75 and 76.

Buckwalter and Dalzell JJ. and a ‘common sense’ approach to change. (1992) 175 CLR 1. describing it as ‘self-evidently unacceptable’.27 moulded. 24 For a view of the role and limitations of the judiciary see the judgment of Brennan J in Mabo v Queensland (No. . One key element is to prove that the accused intended to deprive another of property. See also American Civil Liberties Union v Reno 929 F. 25 See Chapter 16. On the other hand. per Kirby J. This has been described as the ‘genius of the common law’: that the courts may adapt principles of past decisions. 30 Dow Jones v Gutnick [2002] HCA 56. ‘When a radically new situation is presented to the law it is sometimes necessary to think outside the square. The courts could not or would not modify the well-established common law offence of larceny to accommodate this development. On the other hand. the English Court of Appeal. an opportunity – indeed a duty – arises to fashion and build the common law.’29 Kirby J reflected on the specific issue of defamation in the Dow Jones appeal and theorised a re-evaluation and formation of a new ‘paradigm’. it has remained sufficiently flexible to adapt to modern developments. para 115.8 LAW OF ELECTRONIC COMMERCE rock and the foundation of modern English and colonial law (including Australia’s law). 2) [1992] HCA 23. stability and protection of society and commerce. in the domain name case Marks & Spencer v One in a Million. particularly the joint judgment of Sloviter CJ. And so it should. by analogical reasoning.30 23 Dow Jones v Gutnick [2002] HCA 56. With the advent of new and novel factual circumstances the judiciary must find solutions for the benefit. para 91. This is problematic for intangibles. His Honour questioned the wisdom of refusing to find a new remedy in new circumstances. 27 [1999] 1 WLR 903.25 A reading of the US Supreme Court decision of Reno v American Civil Liberties Union26 provides a similar missed opportunity in the US context. [1998] EWCA Civ 1272. Where a person accesses a computer and ‘steals’ a computer file a curious thing happens: the information is both stolen and left behind. The result is such a departure from traditional passing off that it is referred to as ‘domain name passing off ’. Supp 824 (1996). 29 Dow Jones v Gutnick [2002] HCA 56. 26 521 US 844 (1997). para 112.23 When the new problem is as novel. It was left to the legislature to enact cybercrime legislation to encompass offences that could not be imagined only a matter of years earlier. In the words of Kirby J. The development of common law larceny failed to predict or consider this. ‘to the resolution of entirely new and unforeseen problems’. complex and global as Gutnick’s case. The common law crime of larceny dictates that the prosecution must prove certain elements of the crime to elicit a conviction.24 Two examples illustrate the best and worst of judicial malleability. twisted and interpreted the five established elements of the tort of passing off to provide a remedy where one previously did not exist.28 This extension of principle when faced with domain name piracy is to be applauded. Attempts at prosecution failed. 28 See Chapter 9.

Further reading 31 [2002] HCA 56. forging new paths and boldly leading the way. would encourage an inappropriate and usually ineffective grab for extra-territorial jurisdiction . both institutions responding to commercial realities. even in the absence of any adequate laws. it is undesirable to express a rule of the common law in terms of a particular technology. Accordingly. In the context of reconceptualisation. But within such constraints. emerged from the customs and practices of merchants from the Middle Ages. in practice. commercial parties have embraced electronic commerce. A legal rule expressed in terms of the Internet might very soon be out of date. such as electronic banking and finance. ubiquitous and reactive characteristics. courts throughout the world are urged to address the immediate need to piece together gradually a coherent transnational law appropriate to the ‘digital millennium’. paras 119 and 125. 32 For details see Chapter 3. the internet and cyberspace requires careful management by legislators and structured application and development of existing legal principles by the courts. is an important example. Rules governing bills of exchange and letters of credit were crafted by commercial parties long before the law makers had the opportunity to legislate. Doing so presents problems where that technology is itself overtaken by fresh developments. both practical and legal. warnings and surprises in the regulation of electronic commerce.32 There are many pitfalls. . In the face of such characteristics. The law relating to electronic commerce. with contemporary civil society – national and international. Generally speaking. the common law would adapt itself to the central features of the Internet. could be an institutional failure to provide effective laws in harmony.31 In some instances. with the Model Law of Electronic Commerce. Kirby J (in Gutnick’s case) dabbles with new rules for a ‘unique technology’ and the ‘urgency’ of considering such changes: To wait for legislatures or multilateral international agreement to provide solutions to the legal problems presented by the Internet would abandon those problems to ‘agonizingly slow’ processes of lawmaking. The new laws would need to respect the entitlement of each legal regime not to enforce foreign legal rules contrary to binding local law or important elements of local public policy. It can scarcely be supposed that the full potential of the Internet has yet been realised. The lex mercatoria. namely its global. but the result was that commercial customs and practice became recognised by the courts and then the legislature. simply to apply old rules. . The alternative. These voyages are examined in this book. .THE LAW OF ELECTRONIC COMMERCE 9 Change is not new. for example. The next phase in the global distribution of information cannot be predicted. created on the assumptions of geographical boundaries. Their aim was commerce. In other instances the law makers have taken the initiative: the UN Commission on International Trade Law (UNCITRAL) in 1996. as the Internet itself is.

2008. Sydney.pdf.org. institutions and method. The Australian legal system: History.au/judgepub/2003/fry070403. The spirit of liberty: Papers and addresses of Learned Hand. Legal reasoning and legal theory. Supreme Court of Queensland publications: archive. Brisbane 2003. . Clarendon Law Series.sclqld. Part Three. ‘The contribution of an independent judiciary to civilisation’. Oxford. in Irving Dillard (ed. Keynote Address to the Australian Conference on the Law of Electronic Commerce. Billings Learned Hand. Russell Hinchy.). Oxford University Press. 1960. New York.10 LAW OF ELECTRONIC COMMERCE Justice George Fryberg. Alfred A Knopf. Neil MacCormick. Pearson Education Australia. 3rd edition. 1979.

The rule of cyberspace emerges.2 The rule of cyberspace This chapter examines and contemplates law and culture in cyberspace. First. and then uses a discussion of libertarian and classical approaches to predict the future of cyberspace. London. The role of law and indeed the rule of law have different dynamics in cyberspace as a consequence of the architecture of cyberspace and its anonymous. (1871) 1974. 11 . Gordon Press. art and custom. And so is it for cyberspace and the rule of cyberspace. It is spontaneous order which best describes and to a limited extent predicts regulation for electronic commerce. economic influence on human culture and the role of law and regulation together form a subculture which both impacts on and moulds electronic commerce. law and culture may be expressed as the ‘rule of cyberspace’. religion. This chapter examines the juxtaposition of culture and cyberspace. This is followed by consideration of theoretical bases for law and order in cyberspace. The resultant structural balance among technology. pseudonymous and borderless features. Primitive culture: Researches into the development of mythology. the nature of cyberspace is examined. law. language. from the environmental factors fashioning cyberspace. order and stability. philosophy. by processes known as ‘spontaneous order’.1 1 See Sir Edward Burnett Tylor. Culture brings about communities. This spatial dimension. a modern application of spontaneous order. Cultural and environmental juxtaposition with cyberspace Human interaction tends towards order and has an aversion to chaos.

every step is carefully planned and choreographed. (1998) UNSWLJ 52. Denmark and Norway and overlord of Schleswig and Pomerania. Organising bodies do not know the exigencies of the diverse predilections and demands of the participants. No one controls cyberspace. Technology has fooled human senses for years. The internet: Heavily regulated by no one in particular. magnetic and optical forces with storage facilities permit users to carry out steps that produce results in real space. Electrical.2 Cyberspace poses problems and challenges to visitors.4 Cyberspace Cyberspace is an illusion. To many cyberspace is a nebulous. Similarly. The size. Yet its users visit it. all with their own agendas. and the tide proceeded to disobey him. but not human command. consumers. The legend of King Canute3 is of a king believed to be so powerful that he could command the tides to stop. extent and use of cyberspace have challenged forecasters. There are many stakeholders and users. Whether users find information or goods and services via Google. Users become as immersed in cyberspace as they are engrossed in the narrative of television and movies. Many have drawn a parallel with cyberspace: any attempt to regulate it would be equally futile. it takes on an ethereal quality and allows escape 2 Tom Bell. Flashing still pictures 24 times a second gives the illusion of movement. Concerned that his subjects believed him to be almighty to the point of immortality. ‘Privacy in cyberspace’.12 LAW OF ELECTRONIC COMMERCE Cyberspace is infused with a kind of spontaneous order. Customs. direction. cyberspace is a mystery. see Michael Kirby. Tiny pixels on a television or computer screen give the illusion of words. The sea was beyond mere human governance. The demonstration merely confirmed the limits of his sovereignty. drawings and movement. unsafe and ungoverned place. By incalculable actions and inputs – spontaneous order – cyberspace has gained structure and presence. Canute undertook a practical demonstration at Thorney Island and ordered the tide to stop. The illusion is real enough. The dot matrices on newspaper photographs give the illusion of people and places.html. With curiosity and wonder we develop an appreciation of real space as a home and vessel for life. Through a process of exploration and learning humankind has begun to understand the limits of its physical world. listen online to radio around the world.tomwbell. (1997). This is not new. . and to owners. www. regulators.com/writings/ InterReg. (1998) UNSWLJ 47 and Graham Greenleaf. Some dip their toe in and play in this new universe. ‘An endnote on regulating cyberspace: Architecture vs law?’. or send and receive email. and has thus evolved protocols through public participation. It has no physical presence. merchants and tourists. 4 For example. send messages and transact business through it. at least initially. usages and structure have emerged from human action and interaction. This was of course futile. impacts and influences. 3 Canute (994–1035ad) was king of England.

.8 Michael Benedikt9 describes cyberspace as: ‘A new universe. with access to the Internet .THE RULE OF CYBERSPACE 13 from terrestrial shackles. .5 The High Court of Australia described the described the internet and cyberspace in the following terms: [A] decentralised. cyberspace is malleable. New York). It is made up of interlinking small networks from all parts of the world. self-maintained telecommunications network. Effectively. 7 The concept was expanded and popularised in his 1984 novel Neuromancer (Ace Books. Since users can transmit and receive messages on the Internet without revealing anything about their identities or ages . 1984. . . Gibson has stated. consequently. Ace Books. para 80 per Kirby J. exist at fixed ‘locations’ on the Internet. global and ambient in its nature. . Many sources incorrectly cite Gibson’s 1984 book as the first use of the word ‘cyberspace’. . anywhere in the world. 9 Michael Benedikt. It is ubiquitous. I used it to define a kind of navigable. a virtual world . . This transformation of cyberspace is already underway. . ‘cyberspace’ – located in no particular geographical location but available to anyone. Its corridors form wherever electricity runs with intelligence . Neuromancer. borderless. a parallel universe created and sustained by the world’s computers and communication lines . . Thus. . MIT Press. . Cyberspace undeniably reflects some form of geography. the only constraint on access to the Internet is possession of the means of securing connection to a telecommunications system and possession of the basic hardware.’ 8 William Gibson. 5 521 US 844 (1997). though. potentially amounting to a single body of knowledge. In the end. The realm of pure information. more amenable to zoning laws. The Internet is accessible in virtually all places on Earth where access can be obtained either by wire connection or by wireless (including satellite) links. it is all real people dealing with real people. 1991. In Reno v American Civil Liberties Union the US Supreme Court has defined ‘the internet’ and ‘cyberspace’ in the following terms: The Internet is an international network of interconnected computers . Hence the term ‘cyberspace’.7 He depicts cyberspace as a ‘consensual hallucination experienced daily by billions of legitimate operators’. . three-dimensional representation of data. This is a word that recognises that the interrelationships created by the Internet exist outside conventional geographic boundaries and comprise a single interconnected body of data. [which] now enable[s] tens of millions of people to communicate with one another and to access vast amounts of information from around the world . to regulation or a form of rule in cyberspace. ‘When I came up with the term [cyberspace] in Burning Chrome. New York. . . Cyberspace: First steps. ‘like cityspace. The tablet become a page become a screen become a world. can be inhabited. iconic. making cyberspace more like the physical world and. 6 Dow Jones v Gutnick [2002] HCA 56. . and sometimes their relationships and actions become convoluted and conflicted enough for them to look to the law for resolution. it is possible to construct barriers in cyberspace and use them to screen for identity. for example. chat rooms and Web sites. Cambridge MA.6 Science fiction author William Gibson first coined the term ‘cyberspace’ in his 1982 novelette ‘Burning Chrome’ in Omni magazine.’ He believes that cyberspace.

(1995) ComputerMediated Communication Magazine: www. You have no sovereignty where we gather.ibiblio. Do not think that you can build it.html. I declare the global social space we are building to be naturally independent of the tyrannies you seek to impose on us.10 Benedikt puts forward the notion that we drift into cyberspace every time we speak on the telephone or become absorbed in a book. And so it is for cyberspace.11 Physical existence in cyberspace remains impossible. You have neither solicited nor received ours. His response to the US Telecom Reform Act of 1996 was to write and issue a ‘Declaration of the Independence of Cyberspace’. nor did you create the wealth of our marketplaces.12 in which he colourfully proclaims that cyberspace cannot be ruled by terrestrial norms. You have no moral right to rule us nor do you possess any methods of enforcement we have true reason to fear. This declaration galvanised the growing anxiety regarding rights and liberties within the cyberspace community: A Declaration of the Independence of Cyberspace Governments of the Industrial World.declaration. We have no elected government. Users. as though it were a public construction project. 11 Michael E Doherty Jr.txt. I ask you of the past to leave us alone. rules and behavioural norms in cyberspace. Yet real space norms remain a starting point. The conservative approach is to apply all real space laws.utexas. vendors and consumers embrace cyberspace however it is defined. You do not know us. He describes the action of visiting cyberspace as ‘like having had your everything amputated’. You do not know our culture. you weary giants of flesh and steel. . Governments derive their just powers from the consent of the governed. It is not a precondition for living. so I address you with no greater authority than that with which liberty itself always speaks. our ethics. On behalf of the future. Appreciating the difference gives meaning to the application of law and regulation. The law of cyberspace emerges as a consequence of their actions. We did not invite you. free for any form of regulation or encumbrance. It is an act of nature and it grows itself through our collective actions. Nevertheless consciousness becomes meshed and even lost in computer depictions.14 LAW OF ELECTRONIC COMMERCE explored. nor are we likely to have one. and the spatiology of information. the new home of Mind. and designed’. You cannot. You have not engaged in our great and gathering conversation. Barlow was an early advocate of freedom of expression and freedom from regulation in cyberspace. University of Texas at Austin. Cyberspace does not lie within your borders. I come from Cyberspace. working and engaging in commerce in real space that its participants understand real space’s underlying physics. edu/architecture/center/benedikt_articles/cityspace. 1993: www. cyberspace. Author and artist John Perry Barlow falls into the latter group.html. or the 10 Cityspace.org/cmc/mag/1995/sep/doherty. nor do you know our world. ‘Marshall McLuhan meets William Gibson in “Cyberspace” ’. The libertarian view is to remove the shackles of real space and create a utopia. You are not welcome among us.org/Misc/Publications/John_Perry_Barlow/barlow_0296. legal or otherwise. 12 Available at www.eff.

France. Where there are real conflicts. identity. movement. and context do not apply to us. where there are wrongs. You claim there are problems among us that you need to solve. since they are natives in a world where you will always be immigrants. These may keep out the contagion for a small time. This governance will arise according to the conditions of our world. We hope we will be able to build our particular solutions on that basis. without fear of being coerced into silence or conformity. enlightened self-interest. expression. In the United States. Madison. unlike you. The only law that all our constituent cultures would generally recognize is the Golden Rule. There is no matter here. whatever the human mind may create can be reproduced and distributed infinitely at no cost. anywhere may express his or her beliefs. Cyberspace consists of transactions. Russia. These increasingly hostile and colonial measures place us in the same position as those previous lovers of freedom and self-determination who had to reject the authorities of distant. which repudiates your own Constitution and insults the dreams of Jefferson. we cannot obtain order by physical coercion.THE RULE OF CYBERSPACE 15 unwritten codes that already provide our society more order than could be obtained by any of your impositions. and the commonweal. Our identities may be distributed across many of your jurisdictions. We believe that from ethics. You use this claim as an excuse to invade our precincts. Because you fear them. all the sentiments and expressions of humanity. Your legal concepts of property. We are forming our own Social Contract. the Telecommunications Reform Act. In China. in America and elsewhere. We will spread ourselves across the Planet so that no one can arrest our thoughts. In our world. that claim to own speech itself throughout the world. we will identify them and address them by our means. are parts of a seamless whole. military force. Mill. Many of these problems don’t exist. you entrust your bureaucracies with the parental responsibilities you are too cowardly to confront yourselves. and Brandeis. our governance will emerge. . Washington. We are creating a world where anyone. They are based on matter. relationships. We must declare our virtual selves immune to your sovereignty. These dreams must now be born anew in us. Ours is a world that is both everywhere and nowhere. but it is not where bodies live. Your increasingly obsolete information industries would perpetuate themselves by proposing laws. no more noble than pig iron. Our world is different. or station of birth. De Toqueville. and thought itself. We are creating a world that all may enter without privilege or prejudice accorded by race. Our identities have no bodies. not yours. you are trying to ward off the virus of liberty by erecting guard posts at the frontiers of Cyberspace. You are terrified of your own children. the global conversation of bits. Singapore. no matter how singular. Italy and the United States. arrayed like a standing wave in the web of our communications. These laws would declare ideas to be another industrial product. We cannot separate the air that chokes from the air upon which wings beat. from the debasing to the angelic. uninformed powers. The global conveyance of thought no longer requires your factories to accomplish. even as we continue to consent to your rule over our bodies. Germany. economic power. In our world. but they will not work in a world that will soon be blanketed in bit-bearing media. so. you have today created a law. But we cannot accept the solutions you are attempting to impose.

which was ‘far away from government because there [we]re no centralised control mechanisms’. cyberspace.15 He argues that the internet is the product of spontaneous order in the same manner as the American Wild West. Electronic Frontier Foundation Barlow co-founded the Electronic Frontier Foundation. and the law of cyberspace’. Post advocates unfettered movement in cyberspace. ‘What Larry doesn’t get: Code. However. In both the Wild West and the internet. Nevertheless there are parallels between the development of the rule of law and the emergence and adoption of the rule cyberspace. Morriss predicted that the internet would not need outside assistance to reach its potential.14 Andrew Morriss continues the analogy in his article ‘The Wild West meets cyberspace’.ssrn. he said. Nevertheless the miners and cattlemen in the West established protocols and developed norms of behaviour. dealing with bulk emailing at a time when such practices were not legislatively prohibited. 14 Elizabeth Greene. an apt metaphor as cyberspace genuinely is a frontier.cfm?abstract_id=264201. jurisdictional. It is enshrined in the common law tradition.html. David Post13 is one such who saw the potential of the new frontier. order spontaneously emerges.edu/lawschool/dpost/Code.pdf. www. 13 See David Post. has been judicially recognised. The rule of cyberspace morphs. Co-Founder. John Perry Barlow Cognitive Dissident. (2000) www. ‘The Wild West meets cyberspace’. arguing that the internet ‘should be a free-flowing cauldron of creative energy unencumbered by copyright. in relation to an earlier frontier. regulation or even taxes. (2000) The Chronicle. May it be more humane and fair than the world your governments have made before. Jefferson’s moose. An understanding of the rule of law allows the cyber user to appreciate the rule of cyberspace. as did his role model. would only hamper the free flow of information and design by the millions of stakeholders and users. Some parallel the electronic frontier with the Western frontier of North America in its openness and initial lawlessness in the 1800s. and liberty in cyberspace’. papers. Thomas Jefferson. a form of etiquette on the internet. Order and regulation emerge from varied parties. . The rule of cyberspace is not and cannot be based on the rule of law. melds and moulds in response to its own inherent dynamic forces. trademark. ‘David Post: Freeing cyberspace from the rule of law’. [1999] OJ No.temple. and in continental Europe is known as Rechtsstaat. 2246 (Sup Ct).16 The rule of law and the rule of cyberspace The ‘rule of law’ is a basic precept of legal systems.temple. unplanned and unexpected. The concept of impartial rule of law is found in the Chinese political philosophy of legalism. 15 Andrew Morriss. ‘Napster. 16 Ontario Inc. and the languages of social life’. law. (1998) 48 The Freeman: Ideas on liberty 427. and ‘“The free use of our faculties”: Jefferson.com/sol3/papers.edu/ lawschool/dpost/Napster.16 LAW OF ELECTRONIC COMMERCE We will create a civilization of the Mind in Cyberspace. v Nexx Online Inc. Governmental control. and other concerns’. 20 October. the social norm of netiquette.

London. but to how the legal system upholds the law. pp. to that of any individual. John Adams. Introduction to the study of the Law of the Constitution. It means. .3. 10th edn. p.20 The concept of rule of law does not relate to morality. Englishmen are ruled by the law. justice or efficacy of laws. in justification and enunciation of the principle of separation of powers. . the right to be heard by an unbiased medium and similar outcomes in similar circumstances. 194. a man may with us be punished for a breach of law. ‘The rule of law is preferable . explained the rule of law thus: [E]very official.mit. No one is above the law. art. 18 AV Dicey. 202–03. 17 Aristotle. in their personal capacity. In the British common law tradition. Book Three. Introduction to the study of the Law of the Constitution. More than 2000 years ago Aristotle said. Law of the Constitution. . trans. wrote: ‘to the end it may be a government of laws and not of men’.THE RULE OF CYBERSPACE 17 The rule of law The rule of law ordains that all people come before the law equally. London. . in a draft of the constitution of the Commonwealth of Massachusetts. Many writers have espoused subsets of legal principles in an attempt to define this concept. liable to punishment. Dicey outlined the three ‘kindred conceptions’ underpinning the English constitution. Benjamin Jowett. It is often perceived as a prerequisite for democracies. and all subordinates. though carrying out the commands of their official superiors. in American law.21 namely: • No man could be punished or lawfully interfered with by the authorities except for breaches of law. XXX (1780). for acts done in their official character but in excess of their lawful authority. and made. Albert Venn Dicey. 19 AV Dicey. . is under the same responsibility for every act done without legal justification as any other citizen. are as responsible for any act which the law does not authorise as is any private and unofficial person.html. and by the law alone. the absolute supremacy or predominance of regular law as opposed to the influence of arbitrary power . . .edu/ Aristotle/politics. the ‘rule of law’ in this sense excludes the idea of any exemption of officials or others from the duty of obedience to the law which governs other citizens or from the jurisdiction of the ordinary tribunals. The Politics.’17 It ensures fairness to all. but he can be punished for nothing else. or to the payment of damages. . equality before the law or the equal subjection of all classes to the ordinary law of the land administered by the ordinary law courts. 20 Massachusetts Constitution. Aristotle posited the rule of law as a system of rules inherent in the natural order of things. Part XVI. in his treatise Law of the Constitution in 1895. First Part. . from the Prime Minister down to a constable or a collector of taxes. Macmillan. [Appointed government officials and politicians alike] . again. 21 Dicey. http://classics. 1959. 1950. The quote has been cited with approval by the US Supreme Court and every State Supreme Court in the United States. though non-democratic nations and dictatorships can also be said to adhere to the rule of law.18 [The ‘rule of law’ ensures] . 9th edn. Macmillan.three.19 In a similar vein. The Reports abound with cases in which officials have been brought before the courts.

emerging intelligence. powerful search engines give order and structure to the data. soil nutrients. 23 Bradford Smith. The rule of cyberspace Cyberspace is crammed with multitudes of data. The rule of cyberspace is the natural. emergent order arising from data chaos. 4th century bce The concept of spontaneous order has been used to explain the development of language. The rainforest has an order and stability which may have evolved over eons. . from priceless gems of information. While certain nation states do control and restrict access and there are laws which address certain materials and behaviour. air composition and so forth). images. ‘The third industrial revolution: Policymaking for the internet’. language became ordered. water flow.22 Bradford Smith describes the internet as a third industrial revolution. hardware and telecommunications. science and technology. (2001) 3 Colum Sci & Tech L Rev 1. However. energy transference. pp. text. agriculture and eco-systems. knowledge and reasoning to abhorrent rubbish and trivia. And yet. so do countless other 22 Ibid. light. Cyberspace is chaos. is subject to the ordinary laws of the land. markets and economies.. operating without any specific intent or design: given an environment with rules. A rainforest has a particular hierarchical order because of laws of science and physical attributes (gravity. Spontaneous (or endogenous) order Good order results spontaneously when things are let alone. neither directly impacts the ability of a user to place any data online. Given human relations. sounds and videos. a coherent order emerges. • There is no need for a bill of rights because the general principles of the constitution are the result of judicial decisions determining the rights of the private person. It is a natural mechanism. regardless of rank. Order spontaneously results from such chaos.23 He examines the characteristics of the rule of law in real space and compares them with the rule of law in cyberspace. language emerged without design. Forms of etiquette emerge in social and commercial situations. should any factor alter. There are no global editors. based on the joint and corresponding technological advances in software. Demand yields an effective order. 175–84. In all human culture. nor attempts any structural control. multiple behaviours and structures. multiple behavioural inputs and a community. This data is not stored or presented with any order or structure. Zhuangzi. data checkers or barriers.18 LAW OF ELECTRONIC COMMERCE • No man is above the law and everyone.

An alternative approach to the concepts of spontaneous order and natural order is Adam Smith’s ‘invisible hand’ theory: 24 Friedrich Hayek. Rather than arising ‘spontaneously’. Chicago IL. he regarded the economic concept of a ‘price mechanism’ as a spontaneous form of order rather than a conscious human invention. 26 See note 15. brings about a state of affairs in which prices correspond to costs. order in cyberspace is developing continuously. an order emerges. An alternative expression might be ‘endogenous order’: that is. ‘Economics and knowledge’. Instead it is a spontaneous development for societies structured around a belief in the virtues of the free market. is complex. IV. but spontaneously. 25 Friedrich Hayek. even automatically. 1937. University of Chicago Press.THE RULE OF CYBERSPACE 19 things. ‘The Wild West meets cyberspace’. Hayek defined order as a reaction to given stimuli and circumstances. etc. For example.27 In both the internet and the Wild West. Friedrich Hayek was a Nobel Laureate economist whose theories and principles relating to spontaneous order have been applied to the rule of law. from what begins as disorder. In later years he attributed the birth of civilisation to private property:24 the spontaneous interaction of a number of people. with a multitude of independent factors. The Fatal Conceit. . He believed that the rule of law could not arise artificially. each possessing only bits of knowledge. Economica (New Series). 1988. However. and which could be brought about by deliberate direction only by somebody who possessed the combined knowledge of all those individuals. and a new order emerges with such speed that it is said to be effectively spontaneous. There is not necessarily any law-making authority to determine and enforce appropriate rules. the rule of law means that government is bound by rules fixed in advance. order which originates naturally from within. Hayek recognised and accepted that language emerged not as a conscious human phenomenon. like the rainforest. Through the mechanism of spontaneous order. 33. Equally.. 27 Morriss. he argues that cyberspace is well equipped to govern and rule itself.25 Andrew Morriss26 argues that the regulation of the internet component of cyberspace arose spontaneously in the same manner as did regulation in the Wild West of the United States. p. acceptable behaviour is maintained by rules which have appeared and then developed spontaneously. it emerged as an ordered form. the former being spontaneous and self-generating. He discussed and theorised about evolved behaviour. the expression ‘spontaneous’ is misleading. For Hayek. He contrasts ‘cosmos’ and ‘taxis’ types of order. order arises naturally. vol. Morriss provides a range of insights into natural order in the Wild West and parallels this to examples in cyberspace. Cyberspace. the latter forced or engineered. On one level. Hayek argued that human beings lived within a social order that was more ‘taxis’ than ‘cosmos’. And yet. this make how those in command of the rules will use (or abuse) their coercive powers in given factual situations foreseeable.

Cyberspace is dynamically evolving. he intends only his own gain. . contains the philosophical underpinnings and statements of methodology that underlie his later broader works on political economics. though they perhaps may feel it with the most exquisite sensibility. 31 Smith. emphasis added. The Wealth of Nations. operates on multiple levels: social. The greatest ruffian. Bantam Classic. except the pleasure of seeing it. indeed. the most hardened violator of the laws of society. a version of the rule of cyberspace. (1776) 2003.30 It commences with the following declaration regarding the dual facilities of human existence and natural influences: How selfish soever man may be supposed. The Wealth of Nations argues that an organised economic society results from the individual acting selfishly in a capitalistic manner. is by no means confined to the virtuous or the humane. at the beginning of the Industrial Revolution. like real space. commercial. The Theory of Moral Sentiments accentuates the union of human intention and behaviour in a benevolent sense. . In response to a 28 Adam Smith. 30 Adam Smith published The Wealth of Nations in 1776. pulsating with checks and balances. which results in an overall good for the community. or are made to conceive it in a very lively manner. Lessig is an academic who has contemplated and theorised about the nature of cyberspace from its infancy. led by an invisible hand to promote an end which was no part of his intention. organisation and continuation can be successfully explained by such spontaneous order notions. by investing both time and effort into cyberspace.28 Smith’s Theory of Moral Sentiments. The Theory of Moral Sentiments. neither intends to promote the public interest. and subject to the vicissitudes of human actions. generally. That we often derive sorrow from the sorrows of others. Each section of the community.20 LAW OF ELECTRONIC COMMERCE Every individual . and by moral and capitalistic principles. Cyberspace.31 Notwithstanding the philosophical differences between Smith’s early and later writings. for this sentiment. and render their happiness necessary to him. though he derives nothing from it. . and he is in this. like all the other original passions of human nature. the emotion we feel for the misery of others. is a matter of fact too obvious to require any instances to prove it. domestic. there are evidently some principles in his nature. . . 29 Adam Smith published The Theory of Moral Sentiments in 1759. as if guided by an ‘invisible hand’. which interest him in the fortunes of others. A code of cyberspace Lawrence Lessig espouses a new and separate code applicable in cyberspace. such as The Wealth of Nations. is not altogether without it. when we either see it. as in many other cases. educational and for entertainment.29 an early work. Of this kind is pity or compassion. nor knows how much he is promoting it . each can be extended to human existence in cyberspace. Book IV Chapter II. builds on the tools and structure laid down by predecessors. Cyberspace structure.

and you open yourself to flaming. and you might find 32 ‘Cyberspace and the law of the horse’. then examined how law in real space can regulate cyberspace.32 Lessig published a rebuttal: ‘The law of the horse: What cyberlaw might teach’. 2002.33 He began by considering particular problems of regulation that cyberspace might present. 1996 U Chi L Forum 207. and he advocates the importance of existing works entering the public domain quickly. 35 Lessig.THE RULE OF CYBERSPACE 21 remark by Judge Frank Easterbrook that there was no more a ‘law of cyberspace’ than there was a ‘law of the horse’. (1998) 27 J Legal Stud 661. ‘The law of the horse: What cyberlaw might teach’. Code in essence becomes an alternative sovereign – since it is in essence an alternative structure of regulation. 1999. These four factors apply validly and equally to the unique yet dynamic architecture of cyberspace. “spoof” someone’s identity in a MUD.34 He describes the rule of cyberspace as a code.org. Basic Books. But who authors this sovereign authority? And with what legitimacy?36 One of Lessig’s examples relates to copying. 34 Lawrence Lessig. with sanctions for noncompliance. Cyberspace has impacted on the technology of copying and on the power of law to protect against illegal copying. ‘The new Chicago School’. (1999) 113 Harvard Law Review 501. 125–7. 38 See also Lawrence Lessig.38 In real space. At heart. Lessig gives this example: ‘Talk about democratic politics in the alt. 37 Lessig. and other laws of cyberspace. Code: The future of ideas. ‘The law of the horse: What cyberlaw might teach’. law demands and requires that citizens behave in a certain community-minded manner. and finally proposed that cyberspace could in turn regulate law.37 Lessig explores the notion that computer code may regulate conduct in much the same way that legal codes regulate real space. who boasted that the law school did not offer a course in ‘the law of the horse’. he claimed. But we may be surprised by the manner in which they are manifested. He expanded these examples to propose models for applying regulation in cyberspace and real space. there is a systematic competition between cyberspace and real space which ‘illuminate[s] the entire law’. markets and code. For example. Markets restrain behaviour fiscally and code establishes regulation on the individual and collective behaviour by the sheer ‘architecture’. New York. in Code: The future of ideas Lessig argues that too much long-term copyright protection hampers the creation of new ideas. Code: The future of ideas. a former Law Dean at University of Chicago. norms. pp. 502. and that such intellectual property concepts are inappropriate in the new medium. meaning simply the ‘physical world as we find it’. the pedigree of the codewriters becomes central. The code of cyberspace comprises components real and ethereal. Social norms involve the threat of punishment (for breaches) by fellow citizens. ‘the software and hardware that makes this part of cyberspace as it is’:35 Once it is plain that code can replace law. Code. p. Lessig proposes four factors which regulate real space and cyberspace: law. See Lawrence Lessig’s website code-is-law. Lessig believed that cyberspace has a parallel ‘architecture’ to real space. He argues that the code in cyberspace supplants copyright law in real space. New York. . Judge Easterbrook’s reference is to an argument by Gerhard Casper. 33 Lawrence Lessig.knitting newsgroup. Basic Books. 36 Lawrence Lessig.

and as the Russians saw. In fact. David Post submits an impressive rebuttal in his article ‘What Larry doesn’t get’. so too are we beginning to see in cyberspace that this building is not the work of an invisible hand. cyberspace will become a perfect tool of control. and not necessarily control for some evil. there remains disagreement about the extent to which coercive power of the state needs to be invoked to get those communities built and to get people to live there. Foundations are laid. Left to itself. will not fulfill the promise of freedom. fascist end. 1439. . is constructing an architecture that perfects control – an architecture that makes possible highly efficient regulation.. is another way of using coercive force to achieve directed change for the common good. 40 Ibid. but the ‘architectures of liberty are of fundamental importance’. Just as the founders of our nation learned from the anarchy that followed the revolution (remember: our first constitution. Collective action. was a miserable failure of do-nothingness). But spontaneous order is a process akin to evolution. 42 Ibid.42 Information wants to be free The dynamics of cyberspace and the resultant order give the impression that an overall design and structure was planned. we have reason to believe that cyberspace. Post states that the ‘conscientious libertarian recognizes that there are times when collective action is required to promote the common welfare’. pp. The invisible hand. expressing concern at who makes such determinations and at what expense. There is no reason to believe that the grounding for liberty in cyberspace will simply emerge. quite the opposite is the case.40 Lessig’s libertarian writings may be explained as stemming from a deep concern and passion for the protection of the growth of cyberspace as a new and significant medium. they are not found. much like Smith’s ‘invisible hand’ concept. He does not want the future of the internet to be left to an invisible hand or the whims of some natural or spontaneous ethereal force.’39 Understanding the forces inherent in the rule of cyberspace assists in an appreciation of the rule of law in real space by providing a new and unexpected perspective. through commerce. Not necessarily control by government. 41 ‘What Larry doesn’t get: Code and other laws of cyberspace’. they don’t magically appear. with no planned 39 Ibid. in Post’s view. Control. The invisible hand of cyberspace is building an architecture that’s quite the opposite of what it was at cyberspace’s birth.41 Post argues that Lessig’s calls for collective action are unlikely to entice libertarians into action.22 LAW OF ELECTRONIC COMMERCE yourself toaded. left to itself. Post questions any structured direction. As our framers learned. 1458–9. He concludes that while cyberspace needs architecture. (2000) 52 Stanford Law Review 1439. the Articles of Confederation. Lawrence Lessig does not support Smith’s ‘invisible hand’ approach: Constitutions in this sense are built.

2005. netiquette and rules of human interaction. 45 See J Goldsmith.43 ‘Information’.eff. So you have these two fighting against each other. and speedy communications are just a few of the factors that shape and contribute to – and equally are shaped and developed by – the rich fabric of cyberspace. massive actual damage from blackouts. ‘Regulation of the internet: Three persistent fallacies’. in cyberspace.txt. defamation and crime). . of itself. A variation in any one aspect may result in a change in cyberspace. p. Cyberspace has become a medium beyond the control of terrestrial jurisdictions. for example. 1984.eff. Whole Earth Review. 44 ‘The internet interprets censorship as damage. intellectual property tensions. and other information may be regarded as rubbish. because the cost of getting it out is getting lower and lower all the time.45 Spontaneous or endogenous order is not regulation and it is not control. emphasis added. These factors coexist and coalesce. The behaviour of individuals in real space can be targeted. posted and downloaded. The right information in the right place just changes your life. Those who attempt control will cause shifts in the structure of cyberspace and fluctuations in the order. business identifiers.44 This is a by-product of the utilisation of mass networks. but the control of cyberspace globally is beyond reach. 49. (1998) 73 Chi-Kent L Rev 1112. San Diego CA. read. and our penchant for information and entertainment. And yet. war or even a nuclear catastrophe. Point Foundation. Subjectively. The Electronic Frontier Foundation quotes collection. Conclusion Spontaneous order facilitates diversity and flexibility and arises in many and varied ways: online protocols.org/Misc/EFF/?f=quotes. has no mind or direction.THE RULE OF CYBERSPACE 23 direction or apparent purpose. Such a process is reflected in the phrase ‘information wants to be free’. because it’s so valuable. but the process engenders order. and routes around it’: John Gilmore. But it is of different value to each individual. information appears to have a life of its own. hypertext mark-up language. the human predilection to control for particular purposes (this targets aspects of cyberspace such as child pornography. The infrastructure of cyberspace provides both order and freedom given the demands of its human users. taken from a hackers conference in 1984: On the one hand information wants to be expensive. as it is copied. second by legislation and regulation. where multiple access and the copying of digital data (information) has virtually no cost. sent. third by protocols. information wants to be free. but control of cyberspace is 43 Stewart Brand. The cyberspace community is impacted first by the human condition and human use. The architecture of the internet interprets attempts at censorship as damage and routes around it. either innate in the architecture or in the form of etiquette. w2. which include in their initial design a way to route around damage. It is a process. should there be. On the other hand. to human users certain information may be considered valuable. the commercial presence of the private sector.

‘Foucault in cyberspace: Surveillance. First Vintage Books. The rule of cyberspace is both the juxtaposition of hardware and structure with verisimilitude. Graham Greenleaf. it is the amalgamation and the fraternity of factors of spontaneous endogenous order. Mass Market Paperback. ‘Reading the Constitution in cyberspace’. ‘The law of the horse: What cyberlaw might teach’. Lawrence Lessig. (1997) University of Cincinnati Law Review 66. Lawrence Lessig. ‘An endnote on regulating cyberspace: Architecture vs Law?’. Introduction to the study of the Law of the Constitution. . Ace Books. Friedrich Hayek. The backbone of a democratic society is the concept of the rule of law. 52. Legislation and Liberty. ‘The Wild West meets cyberspace’. for instance. sovereignty. The rule of cyberspace is not simply the rule of law in cyberspace. (1999) 113 Harvard Law Review 501. 1973. AP Morriss. Volume 1: Law. New York. Cyberspace and the internet are exquisite examples of spontaneous or endogenous order. The Wealth of Nations. (1996) 45 Emory LJ 869. (1998) 48 The Freeman: Ideas on Liberty 427. However the rule of cyberspace has evolved to a point where no person. AV Dicey. MIT Press. Book IV Chapter II. 2002. no body and no government can regulate cyberspace. and human behaviour within the cyberspace environment. 2003. (1996) 48 Stanford Law Review 1367. and hardwired censors’. 1885. ‘Law and borders – The rise of law in cyberspace’. 1984. James Boyle. Code: The future of ideas – the fate of the commons in a connected world. David Post. David R Johnson and David Post. Further reading Michael Benedikt. Basic Books. but no less so than in real space. (2000) Stanford Law Review. Macmillan Press. ‘What Larry doesn’t get: Code and other laws of cyberspace’. 1999. The backbone of a robust community in cyberspace is the rule of cyberspace. 1439. and other laws of cyberspace. Behavioural traits and social norms inhibit abhorrent behaviour to a substantial degree. 1991. and North Korea and China may severely regulate their population’s use and entry into cyberspace. Adam Smith. Cambridge MA. Rules and Order. Neuromancer. William Gibson. Lawrence Lessig. Lawrence Lessig. Cyberspace: First steps. London. Code. [1998] UNSWL J 52.24 LAW OF ELECTRONIC COMMERCE not possible. Local communities may filter or restrict access: parents and schools may utilise filters. Vol.

Risk assessment in commerce involves consideration of such factors as the law of contracts.3 Electronic commerce and the law of contract Commerce is typically about profit.wto. electronic contracting.org. the International Chamber of Commerce (ICC) www. the Asia-Pacific Economic Cooperation forum (APEC) www.org/english/tratop_e/ecom_e/ecom_e.uncitral. It challenges the wisdom of and necessity for legislation based on the Model Law. and the UN Commission on International Trade Law (UNCITRAL) www. 25 . the United Nations. Many commercial parties have braved the new electronic commerce world without knowing or understanding the legal implications. In an attempt to ensure confidence. and the introduction of the concept of consent as a precondition for the application of selected legislative provisions. the parties. the World Trade Organisation (WTO) www. including Australia and New Zealand. and legislative responses to. The history and development of commerce involves the element of risk.apec. UNCITRAL Model Law of Electronic Commerce In 1996 the UN Commission on International Law Trade (UNCITRAL) released what is now the most popular model for consumer and commercial protection 1 These organisations have included the Organisation for Economic Cooperation and Development (OECD) www. many international organisations have proposed treaties. model laws and protocols to encourage certainty and stability for these international electronic commercial practices and in relation to laws of contract.org.org/subject/e_commerce/.iccwbo.org. This chapter addresses the regulation of.oecd. with significant international acceptance by national legislatures. the goods or services and legal forum.htm.1 The UNCITRAL Model Law of Electronic Commerce (Model Law) has proved the most popular.

overseas territories of the United Kingdom of Great Britain and Northern Ireland.pdf. Colombia (1999). Uniform legislation influenced by the Model Law prepared in the United States (Uniform Electronic Transactions Act. A second principle underlying the Model Law is that of technology neutrality (the term was chosen in response to the recognition that technology is constantly developing). South Africa (2002). 5 For criticism of this approach see Criticisms supra. Jordan (2001).uncitral. all Crown Dependencies of the United Kingdom of Great Britain and Northern Ireland. 3 Legislation implementing provisions of the Model Law has been adopted in Australia (1999). The Model Law has also been adopted in the Bailiwick of Guernsey (2000).4 That is. China (2004). The UNCITRAL Model Law on Electronic Commerce2 (Model Law) was intended to provide national legislatures with a template of internationally acceptable rules that would remove legal obstacles and create a more secure legal environment for electronic commerce.3 The drafting process was attended by representatives of over 50 nations and 10 international organisations. Instead it deals with the principle of functional equivalence of electronic media in commercial transactions. Venezuela (2001). Ecuador (2002). it should be treated equally by the law. ● admissibility and evidentiary weight of data messages. in Bermuda (1999). Pakistan (2002). India (2000). ● writing. and in the Hong Kong Special Administrative Region of China (2000). . where the electronic form is functionally equivalent to the traditional form. and the Turks and Caicos Islands (2000).org/pdf/english/texts/electcom/05–89450_Ebook. Singapore (1998).uncitral. 2 General Assembly Resolution 51/162 of 16 December 1996. as ‘electronic mail’ connotes a certain medium. Available at www.org/pdf/english/texts/electcom/05–89450_Ebook. the Dominican Republic (2002). The Model Law was intended to facilitate the use of electronic communication and storage of information such as electronic data interchange and electronic mail. This principle permeates all legislation based on the Model Law. the Model Law uses the general expression ‘data message’. amended in 1998. For example. New Zealand (2002). the Philippines (2000). See www. Panama (2001).: www. the Cayman Islands (2000). Mexico (2000).org.5 ● attribution of data messages. Slovenia (2000). ● originals. ● recognition by parties of data messages. Thailand (2002) and the United Arab Emirates (2006).26 LAW OF ELECTRONIC COMMERCE in an electronic environment. The Model Law has gained significant international acceptance. ● retention of data messages. the Republic of Korea (1999).uncitral. Sri Lanka (2006). ● formation and validity of contracts. adopted in 1999 by the National Conference of Commissioners on Uniform State Law) and Canada. 4 See Official Guide to Enactment of the UNCITRAL Model Law on Electronic Commerce para 15 et al. The Model Law addresses: ● legal recognition of data messages. France (2000). The Model Law does not specifically refer to contract law. the Bailiwick of Jersey (2000) and the Isle of Man (2000). ● signatures. and Vietnam (2005). It provided standard ways to assess the legal value of electronic messages and legal rules for electronic commerce in specific areas such as carriage of goods. Mauritius (2000).pdf. Ireland (2000).

and • enables business and the community to use electronic communications in their dealings with government. 7 Electronic Transactions Act 2000 (NSW). All Australian states and territories have enacted parallel legislation. April 2000.8 The stated objects within the Act are to provide a regulatory framework that: • recognises the importance of the information economy to the future economic and social prosperity of Australia. Electronic Transactions Act 2000 (SA) . Electronic Transactions Act 2003 (WA).6 Legislation The Electronic Transactions Act 1999 (Cth) is based on the Model Law. at a meeting of the Standing Committee of Attorneys General. the report recommended: ● amendments to legislation and industry codes to permit the appropriate use of digital signatures. para 2. Electronic Transactions (Northern Territory) Act 2000 (NT).10 Specifically.9 Australia In 1997 the Wallis Report on the financial industry in Australia recognised the need ‘to adopt appropriate internationally recognised standards for electronic commerce. . including for electronic transactions over the Internet and the recognition of electronic signatures’. In May 1999.THE LAW OF CONTRACT ● ● 27 acknowledgment of receipt. 8 News release by Federal Attorney General Daryl Williams.7 The Federal Attorney General stated that the ‘enactment of the uniform Bill will achieve the Commonwealth’s goal of national uniform legislation to remove the legal impediments facing electronic transactions’. Electronic Transactions (Queensland) Act 2001 (Qld) . Electronic Transactions Act 2001 (ACT) . All 6 See Model Law.67. the states agreed to enact parallel legislation based on the Commonwealth Bill. • facilitates the use of electronic transactions. electronic notices and documents to improve the efficiency of financial transactions and reduce costs. References to Acts in this chapter will be to the corresponding Acts listed here. Arts 5 to 15. 10 Chapter 2. • promotes business and community confidence in the use of electronic transactions. and ● amendments to the Evidence Acts to take account of electronic transactions and record keeping. 9 Section 3. and time and place of dispatch and receipt of data messages. Electronic Transactions (Victoria) Act 2000 (Vic). Electronic Transactions Act 2000 (Tas) . ● endorsement by industry and government of the Public Key Authentication Framework.

Because there are minor changes in the legislation across the states. 12 Section 8. The stated purpose is to facilitate the use of electronic technology by reducing uncertainty regarding the legal effect of information that is in electronic form or that is communicated by electronic means.12 ‘Laws of the Commonwealth’ are specified in the regulations.15 New Zealand The New Zealand Electronic Transactions Act 2002 and the Electronic Transactions Regulations came into force on 21 November 2003.14 The corresponding state and territory legislation has no need for such a restriction. 14 Australian Constitution. Qld – s7.28 LAW OF ELECTRONIC COMMERCE states and territories have prepared legislation in accordance with the agreement.11 For constitutional reasons the Commonwealth Act applies only ‘for the purposes of a law of the Commonwealth’. ss51(xx). NSW – s6. The Act provides that in its interpretation.16 11 More than 150 exemptions have been proclaimed by regulations. See Electronic Transactions Regulations 2000 (Cth). All these Acts bind the Crown. SA – s6. reference may be made to the UNCITRAL Model Law and any document that relates to the Model Law. . 16 Section 6. 15 Cth – s6. the trade and commerce power and the territories power to give it the ability to deal with electronic commerce issues. Vic – s6. and the time and place of dispatch and receipt of electronic communications and by functional equivalence. 13 Electronic Transactions Act 1999 (Cth) s5.13 The federal legislature relies primarily upon the corporations power. choice of law provisions will play an important part in the application of the rules in this area. The nine pieces of legislation are: Cth NSW Qld SA Tas Vic WA ACT NT Electronic Transactions Act 1999 Electronic Transactions Act 2000 Electronic Transactions (Queensland) Act 2001 Electronic Transactions Act 2000 Electronic Transactions Act 2000 Electronic Transactions (Victoria) Act 2000 Electronic Transactions Act 2003 Electronic Transactions Act 2001 Electronic Transactions (Northern Territory) Act 2000 The Electronic Transactions Act 1999 (Cth) came into full operation on 1 July 2001 and applies to all laws of the Commonwealth except those specifically exempted by its regulations. territories and the Commonwealth. Tas – s4. 51(i) and 122 respectively. WA – s6. The ACT Act omits the provision. NT – s6.

htm. below. 19 The US Act is available at: www. An electronic document to which section 91 applies is to be regarded for the purposes of any enactment as a deed. originals. sent.law.THE LAW OF CONTRACT 29 Provisions of the Electronic Transactions Acts Provisions Short title Commencement Object Simplified outline Definitions Crown to be bound External Territories Validity of electronic transactions Writing Signature Production of document Retention Exemptions Time and place of dispatch and receipt of electronic communications Attribution of electronic communications Regulations Administration of Act Cth 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 ACT NSW NT Qld 1 3 4 5 7 8 9 10 11 12 13 14 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 1 2 3 4. copyright and a separate provision dealing with consent. generated. . received. The Act applies only to transactions between parties who have agreed to conduct transactions by electronic means. or stored by electronic means’. 4 5 3 6 7 8 9 10 11 12 13 14 15 WA NZ17 1 2 3 5 6 7 8 9 10 11 12 13 14 15 36 1 2 3 4 5–6 7 8 18–21 22–24 28–29 25–26 14 9–13 United States The United States Uniform Electronic Transactions Act 1999 is the product of the National Conference of Commissioners on Uniform State Laws and uses the UNCITRAL Model Law as its template. 5 6 7 8 9–13 14–15 16–18 19–21 22–25 26 27 SA Tas 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 1 2 3 4 5 6 7 8 9 10 11 12 13 14 Vic 2 1. communicated. In these circumstances the 17 The New Zealand Act also includes provisions dealing with access.upenn. 18 The Act defines an ‘electronic record’ as ‘a record created.edu/bll/archives/ulc/fnact99/1990s/ueta99.19 United Kingdom In the United Kingdom the two relevant pieces of legislation are the Land Registration Act 2002 (UK) and the Electronic Communications Act 2000 (UK). Part 8 implements electronic conveyancing processes. 18 See Consent. The Land Registration Act 2002 replaced 1925 legislation relating to registered land and dealings with unregistered land in England and Wales. Section 91 applies to certain dispositions (including documents used in conveyancing) in an electronic form which make provision for the time and date when they take effect and include certified electronic signatures of each person by whom they purport to be authenticated.

7). Electronic contracts Contract formality does not alter merely because an electronic medium was used. references to an electronic signature and to the certification of such a signature are to be read in accordance with section 7(2) and (3) of the Electronic Communications Act 2000 (c. the perception of the 1990s was that commercial parties were uncertain of the use of electronic media where formal requirements such as writing. Pty Ltd (1988) 5 BPR 11. The courts have had little difficulty recognising contract formation by electronic means.’ 21 See Signatures. Where notice of assignment made by means of a document pursuant to section 91 is given in electronic form. This is not new. in the mid 1800s. and in all states and territories it only appears in the expanded meaning of ‘transactions’. 20 Section 91(10) provides: ‘In this section. in all likelihood. . 22 For example. signature.106 and Databank Systems Ltd v Commissioner of Inland Revenue [1990] 3 NZLR 385.22 However. The Land Registration Act refers to the Electronic Communications Act 2000 (UK) to identify what would qualify as an electronic signature and what constitutes a certification. A contract which can be entered into orally can of course be entered into by use of email and other forms of electronic communication. any transaction of a non-commercial nature’. Reese Bros Plastics Ltd v Hamon-Sobelco Aust.20 Subsequent provisions of the Land Registration Act allow the registrar to arrange an electronic communications network for a range of purposes such as electronic registration and electronic settlement. when the telegraph was first in commercial use. see Brinkibon Ltd v Stahag Stahl und Stahlwarenhandelsgesellschaft mbH [1983] 2 AC 34. Nevertheless. Separate rules deal with the communication of documents in electronic form to the registrar and the electronic storage of documents communicated to the registrar in electronic form. it is to be regarded for the purposes of any enactment as having been given in writing. and also . as including ‘any transaction in the nature of a contract. The title to the nine Australian legislative instruments and the New Zealand Act includes the words ‘electronic transactions’. . production and retention were concerned. agreement or other arrangement. Simple contracts requiring no formality are entered into daily.21 The Explanatory Memorandum to the Act states that the provisions do ‘not disapply the formal statutory or common law requirements relating to deeds and documents but deems compliance with them’. ‘transactions’ implicitly includes contractual communications and documents. The first electronic contract was entered into. .30 LAW OF ELECTRONIC COMMERCE dispositions are to be regarded as in writing and signed by each individual. and sealed by each corporation whose electronic signature they have. The word ‘contract’ does not appear in the Commonwealth or New Zealand legislation. below.

24 Footnote to Art. The necessity for the Electronic Transactions Acts is questionable. received or stored by electronic. Art. ‘Data message’ is defined as: ‘information generated.25 The expression ‘data message’ is used as a technology-neutral term. and the basic constructs of offer and acceptance. electronic data interchange (EDI). Art. exploitation agreement or concession. ‘Relationships of a commercial nature include. telegram. radio and telephone.24 Its provisions are intended to affect contract formation and performance. electronic mail. 1. distribution agreement. and more recently by telex and facsimile – the emergence of the internet. what would the courts decide in circumstances where the Electronic Transactions Acts do not apply? Second. First.’ 25 Model Law. Historically the courts have proved most flexible in such circumstances. investment. but not limited to. Article 5 provides: Information shall not be denied legal effect. 1. whether contractual or not’. but are not limited to. carriage of goods or passengers by air. commercial representation or agency. sea. 2. what is the effect of exemptions listed within the Act or its Regulations? Application of the common law Despite the fact that for more than a century the common law has recognised electronic communications – by telegraph. financing. consulting. validity or enforceability solely on the grounds that it is in the form of a data message. the UNCITRAL Model Law deals with general concepts applying to ‘any kind of information in the form of a data message used in the context of commercial activities’23 rather than contract issues specifically. leasing. records and documents. In the Australian and New Zealand legislation the expression used is ‘electronic communication’. rail or road.THE LAW OF CONTRACT 31 Notwithstanding the general absence of references to contracts. Similarly. sent. construction of works. . the following transactions: any trade transaction for the supply or exchange of goods or services. engineering. such as the timing and place of communications. but is to be interpreted broadly ‘so as to cover matters arising from all relationships of a commercial nature. Two questions arise from this assumption. joint venture and other forms of industrial or business cooperation. telex or telecopy’. stating. the Electronic Transactions Acts do affect key elements of contracts. legislators seem to have assumed that the common law would not recognise functional equivalence nor the validity of electronic communications and electronic documents. factoring. insurance. banking. licensing. Common law In their zeal. optical or similar means including. EDI (Electronic Data 23 Model Law. The note expands the scope.

1427 (ND Cal 1997) and Lockheed-Arabia v Owen [1993] 3 WLR 468. In McGuren v Simpson.’ The court regarded the words of the email ‘yes I spent the money and I shouldn’t have’. Lulham LCM stated that his decision was also based on the common law: ‘If the name of the party to be charged is printed or written on a document intended to be a memorandum of the contract. I would be blinding myself to commercial and technological realities to find that an email communication in the present circumstances was not written notice. In 2007. para 48. in holding that the limitation period had been extended. 949 F Supp. His Honour rejected the submission ‘because an email is an electronic representation of writing and therefore does not constitute writing itself as required by [the Distributorship agreement between the parties]’. Section 54 provides that the limitation period recommences where a confirmation or acknowledgment is made before expiry of the period. 28 [2007] FCA 478. See also the conflicting US decisions of Ballas v Tedesco 41 F Supp 2d 531. The limitation period was six years. at 541 and Graham Technology Solutions Inc. accordingly.32 LAW OF ELECTRONIC COMMERCE Interchange) and email has led governments to legislate new rules. On appeal to the NSW Supreme Court all parties agreed that as the Act commenced in 2001 it did not apply to the 1999 email. either by himself of [sic] his authorised agent. .29 He stated: The requirement of written notice is to be construed in light of the fact that this is a commercial agreement made between two companies engaged in the computer software business. for international jurisdictional reasons. . Lulham LCM incorrectly applied the Electronic Transactions Act 2000 (NSW). the disputed email acknowledgment was sent and received on 29 September 1999 and proceedings commenced on 26 August 2002. together with the name appearing in the email.28 Jacobson J applied ‘domestic law’ because. . v Thinking Pictures Inc. However. in Hume Computers Pty Ltd v Exact International BV. as a written and signed confirmation of McGuren’s obligation to Simpson. The court concluded: ‘It is [this court’s] view that . 30 [2007] FCA 478. para 49. it is his signature whether it is at the beginning or middle or foot of the document.30 26 [2004] NSWSC 35. lex fori applied. The plaintiff’s cause of action arose on 26 November 1993. A handful of cases show that the common law courts would have managed.’27 The issue before the NSW Supreme Court was whether at common law the email amounted to writing and signature for the purposes of section 54 of the Limitation Act 1969 (NSW). 29 [2007] FCA 478.26 McGuren claimed Simpson was barred by the Limitation Act 1969 (NSW) from commencing legal proceedings for debt. provided such acknowledgment is in writing and signed by the maker. 27 Lulham LCM cited a passage from Cheshire and Fifoot’s Law of Contract (7th edn) and the case Darryl v Evans (1962) H&C 174 at 191. the email sent by the plaintiff constitutes a written document. Initially. s54 of the Act ought to be read to accommodate technological change and that.

Queensland’s exemptions appear in the Schedule to its Act. Uniform legislation would remedy this defect. statutory declarations. Schedule 1. Note Western Australia.5 to 3. For example.32 The Electronic Transactions Acts were premature. 35 Electronic Transactions Regulations 2000 (Cth) Schedule 1. authenticated. The Commonwealth’s jurisdiction is inherently different from that of the states and territories and its Act’s regulations list more than 150 specific exemptions. 5. Law Commission for England and Wales paper. deeds and much more. Electronic Transactions Regulations 2003 (WA) regulations 3.THE LAW OF CONTRACT 33 In Wilkens v Iowa Insurance Commissioner. available at: www. verified or witnessed by a person other than the author of the document’. 37 Electronic Transactions (Northern Territory) Regulations regulation 2. verified or witnessed’ and in South Australia ‘witnessed. 36 Electronic Transactions Regulations 2007 (NSW) regulations 4. 38 Electronic Transactions (Queensland) Act 2001 (Qld) cl6. applying to many transactions. Electronic Transactions Regulations 2003 (WA) regulations 3.31 the Iowa Court of Appeals held that a requirement to keep a written record of an insurance contract was satisfied by an insurer keeping written records on its computer system. 7. authenticated.gov. in Queensland ‘attested. Exemptions Each of the nine Australian jurisdictions permits exemptions from the application of their respective Electronic Transactions Acts. 33 The ACT is the only jurisdiction not to enact exemptions. 5. In New South Wales and Western Australia it is ‘verified. The Law Commission for England and Wales. affidavits. Electronic Transactions Regulations 2001 (Tas) regulation 4(a). authenticated.lawcom. 31 (1990) 457 NW 2d.38 This expression is a minefield. The Acts at best complicate commercial transactions and contracts unnecessarily and at worst are redundant and superfluous. . in its paper ‘Electronic commerce: Formal requirements in commercial transactions – advice from the Law Commission’.36 Some exempt testamentary dispositions specifically. reached a view consistent with that expressed in Wilkens: a document which can be printed and stored is ‘in writing’. See Legislative Standards Act 1992 (Qld) s4(5). bills of exchange and cheques.34 There are considerable inconsistencies in the approaches taken among the jurisdictions. The Court of Appeals applied the common law as the case preceded the US legislation. the order of words varies. attested or witnessed’. Electronic Transactions (Victoria) Regulations 2000 regulation 5. the last to enact its legislation. Electronic Transactions Regulations 2002 (SA) regulation 5.23. 34 This is in accordance with the Queensland Parliament’s principle that legislation should not contain Henry VIII clauses.35 Only two states exempt dispositions of land. 32 Paragraphs 3.37 Others use a variation of the words ‘a requirement or permission for a document to be attested. chose to exempt testamentary dispositions specifically and include the general expression.pdf. Curiously.uk/docs/e-commerce.33 All except Queensland permit exemptions by regulations. verified or authenticated’. notices. attested. contracts. Electronic Transactions Regulations 2007 (NSW) regulation 5(f) . Electronic Transactions Regulations 2002 (SA) regulation 4.

above. W Caelli and P Little. The situation then falls to the common law: the courts will in these circumstances independently determine that a given electronic communication or document will or will not suffice for a particular requirement. The Guide to the UNCITRAL Model Law explains that the matter of specifying exclusions should be left to enacting states. authenticated. verified or witnessed’ document exemption. it warned that the objectives of the Model Law ‘would not be achieved’ if legislators used ‘blanket exceptions’. 40 See A McCullagh. Law and Technology. It merely means that the Act does not apply in that situation. risk falling into this blanket exemption category. with its numerous exemptions. More serious is the effect on the principle of functional equivalence.34 LAW OF ELECTRONIC COMMERCE One might wonder why the drafters chose different phrases and whether courts might interpret the phrases differently. 41 See Common law.39 The Commonwealth. However. verified or witnessed’ document exemption may arise from the perceived impracticality of witnessing electronic documents and a lack of understanding as to how such witnessing can be achieved. Other exemptions include filing and producing documents for judicial proceedings. McGuren v Simpson [2004] NSWSC 35. authenticated. Indeed there are a handful of cases which have already so held (discussed above). Hume Computers Pty Ltd v Exact International BV [2007] FCA 478. Such an assumption is fundamentally flawed. (2001) 1 Journal of Information.41 New Zealand The Electronic Transactions Act 2002 (NZ) provides for exemptions to be listed in the Schedule to the Act (section 14). . including: notices that are required to be given to the 39 Official Guide to Enactment of the UNCITRAL Model Law on Electronic Commerce paras 52 and 69.40 Exemption does not equate to a paper requirement Many of the Commonwealth exceptions and the state exemptions may be based on the assumption that traditional paper or hard copy will be required in exempted situations. However. personal service and powers of attorney. The ‘attested. it seems clear that there is a perception by the drafters that electronic communications and documents ought not to be regarded as functionally equivalent in certain circumstances. The Schedule lists more than 70 specific and general exemptions. Wilkens v Iowa Insurance Commissioner (1990) 457 NW 2d 1. to take better account of differences in national circumstances. ‘Signature stripping: A digital dilemma’. Underlying these exemptions is an apparent mistrust of electronic communications and documents. The rationale for these exemptions is unstated. An exemption does not equate to a paper or hardcopy requirement. and the four states which use the ‘attested.

testamentary instruments. specific requirements of such elements as writing and signature.44 This general rule is subject to other provisions that deal with the validity of transactions. and the form of functional equivalence underlying the legislation. information is not denied legal effect solely because it is(a) in electronic form or is in an electronic communication. WA – s7. Art. validity or enforceability solely on the grounds that it is in the form of a data message. 42 Cth – s8. statutory declarations. 5. Validity of electronic transactions The Australian Electronic Transactions Acts provide that: a transaction is not invalid because it took place wholly or partly by means of one or more electronic communications. which substantially reverse the Act’s effect. Qld – s8. information that is required to be given in writing either in person or by registered post. NT – s7. it is more likely that one of the specific provisions of the Act would be utilised rather than this general provision. negotiable instruments. specifically dealing with the formation and validity of contracts.43 The immediate distinction is that the Australian provision is predicated on a transaction. Both are variations on the Model Law.45 Should an electronic communication of a document be challenged. Nevertheless. perhaps giving rise to an argument that it may be a factor. Vic – s7. 44 UNCITRAL Model Law. SA – s7. Parties entering into contracts using electronic means under New Zealand law must be cognisant of the length and breadth of these exemptions. Common law courts have never questioned the validity of electronic contracts. ACT – s7. while the New Zealand provision is predicated on information. 45 See note 22. Tas – s5. and the specific exemptions. powers of attorney. 11. 5bis (added in 1998) and Art. The list is so broad as to risk falling into the UNCITRAL Guide’s ‘blanket exemption’ and to thwart functional equivalence. NSW – s7. which provides that: Information shall not be denied legal effect. (b) referred to in an electronic communication that is intended to give rise to that legal effect.42 The New Zealand Electronic Transactions Act 2002 states: To avoid doubt. or other documents given on oath or affirmation. . this provision establishes the general rule and context for validity. See also Art. 43 NZ – s8. Queensland added the word ‘merely’ before the word ‘because’.THE LAW OF CONTRACT 35 public. and documents to files or produced in connection with judicial proceedings. affidavits.

default or miscarriages of another person. Such legislation is typically based on the Statute of Frauds 1677 (Imp). . Bills of Exchange Act 1909 (Cth) s8. Section 4 of the original statute48 applies to charges on. or some memorandum or note thereof shall be in writing. c. (2001) 21 Proctor 6. assignments of copyright. agreements upon consideration of marriage or upon sale of lands. ‘Moving the Statute of Frauds to the digital age’. tenements or hereditaments. Bills of Exchange Act 1909 (Cth). (2003) 77 Australian Law Journal 416 and Alan Davidson.36 LAW OF ELECTRONIC COMMERCE Writing The writing provisions of the Electronic Transactions Acts are designed to provide functional equivalence of electronic writing. Instead it dictates circumstances in which electronic writing is to be regarded as equivalent. the Statute of Frauds has been re-enacted in several pieces of legislation.49 Legislation based on the Model Law does not change the impact of Statute of Frauds legislation. . 49 Emphasis added. . 50 For example in relation to dispositions of land. cheques. Also bills of exchange. or whereby to charge the defendant upon any special promise to answer for the debt. Cheques Act 1986 (Cth) s10. where writing is otherwise required or permitted by law. It also states that a person is not able to sue upon such contracts unless ‘some memorandum or note thereof shall be in writing. to answer damages out of his own estate. and signed by the party to be charged therewith. ‘Electronic transactions and contracts’. and signed by the party to be charged therewith. . s89. no action shall be brought whereby to charge any executor or administrator upon any special promise. the aim of which was to help protect people and their property against fraud and sharp practice by legislating that certain types of contract could not be enforced unless there was written evidence of its existence and of its terms. see Conveyancing Act 1919 (NSW) s54A and Property Law Act 1974 (Qld) ss10. 5. tenements or hereditaments. .47 In most common law jurisdictions. 38. or some other person thereunto by him lawfully authorised’. Australian legislation derived from the Statute of Frauds typically permits transactions of certain interests subject to stated formalities (such as the requirement for writing).46 The decision by UNCITRAL to formulate the template legislation was taken because in ‘a number of countries the existing legislation governing communication and storage of information is inadequate or outdated because it does not contemplate the use of electronic commerce’. 59.3. Copyright . 48 Statute of Frauds 29 Car 2. on conditions. Section 17 has similar provisions on the purchase of goods for £10 or over: . promissory notes. among other things. Many pieces of legislation require contracts to be in writing or evidenced in writing. or upon any contract or sale of lands. unless the agreement upon which such action shall be brought. or any interest in or concerning them. or upon any agreement that is not to be performed within the space of one year from the making thereof.50 46 See Sharon Christensen and Rouhshi Low. 47 Official Guide to Enactment of the UNCITRAL Model Law on Electronic Commerce para 3. or some other person thereunto by him lawfully authorized.4.

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Australian provisions
If, under a law of this jurisdiction, a person is required to give information in writing, that requirement is taken to have been met if the person gives the information by means of an electronic communication, where: (a) at the time the information was given, it was reasonable to expect that the information would be readily accessible so as to be useable for subsequent reference, and (b) the person to whom the information is required to be given consents to the information being given by means of an electronic communication.51

In all Australian Electronic Transactions Acts this provision is repeated with the word ‘permitted’ replacing ‘required’.52 Hence the provisions apply to any requirement or permission to give information in writing. Information is defined as ‘information in the form of data, text, images or sound’.53 Let us examine these provisions in more detail. ‘required to give information in writing’ The expression ‘required to give information in writing’ is a clear reference to the Statute of Frauds requirements. The provision has no application to simple contracts which can be formed orally. ‘requirement is taken to have been met’ The expression deems electronic writing to be equivalent. ‘electronic communication’ The expression ‘electronic communication’ is defined as:
(a) a communication of information in the form of data, text or images by means of guided or unguided electromagnetic energy, or both, or (b) a communication of information in the form of sound by means of guided or unguided electromagnetic energy, or both, where the sound is processed at its destination by an automated voice recognition system.54

This media-neutral and technology-neutral approach allows the provision to apply to as broad a range of circumstances as possible. ‘at the time the information was given, it was reasonable to expect’ In the phrase ‘at the time the information was given, it was reasonable to expect’ the use of the expression ‘reasonable’ is both a strength and a weakness. The term
Act 1968 (Cth) s196(3); marine insurance contracts, Marine Insurance Act 1909 (Cth) ss27, 28. Some sale of goods legislation has similar restrictions: for example, see Sale of Goods Act 1895 (WA) s4. 51 Electronic Transactions Acts: NSW – s8(1); Qld – s11; SA – s8(1); Tas – s6(1); Vic – s8(1); ACT – s8(1) and NT – s8(1). Western Australia has substantially similar provisions – s8(1). The Commonwealth has substantially similar provisions in s9(1), but also makes special provision for Commonwealth entities. 52 Cth – s9(2); NSW – s8(2); Qld – s12; SA – s8(2); Tas – s6(2); Vic – s8(2); WA – s8(2); ACT – s8(2) and NT – s8(2). 53 Except in the Commonwealth Act, where ‘speech’ was used instead of ‘sound’. The state and territory legislators chose the wider term with hindsight. 54 The Commonwealth Act again limits application to ‘speech’ instead of ‘sound’.

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gives those who write legislation (the drafters) and those who interpret the law (in the end the courts) great flexibility. There exist myriad factual circumstances in which the provisions could apply, including the use of future technology. This gives the provision strength to be applied where sound judgment and reason so dictate. But the same provision is also a weakness. One of the fundamental objects of the legislation is to provide certainty, but here a party to a transaction may be unable to predict with precision what a court would regard as reasonable. The lawyer in court will argue various meanings and permutations; first what is reasonable and second, whether it was reasonable ‘at the time the information was given’. The uncertainty cancels out the benefit of the provision. The provision is no better than leaving the issue to the courts, which in any event would have found functional equivalence where it was reasonable to do so. ‘the information would be readily accessible so as to be usable for subsequent reference’ ‘reasonable to expect’ The expression ‘the information would be readily accessible so as to be useable for subsequent reference’ is predicated on the principle of functional equivalence. A feature of ink and paper writing is that it is typically accessible for subsequent reference. Again, interpreters of the provision may question the distinction between ‘accessible’ and the use in this provision of ‘readily accessible’. Is this broader or narrower than for paper, or the same? Paper has different durability. The drafters of wills and other important documents typically use a high grade paper, aware that the document may be required many years in the future. Ink can and does fade. Some government departments have the requirement that documents must only be in black ink. This has been based on the traditional concern that ink fades and the modern concern that light-coloured ink does not photocopy faithfully. Paper oxidises and can disintegrate. In these circumstances it is appropriate to read the expression in conjunction with the qualifying expression ‘reasonable to expect’. For example, it would be reasonable to expect that electronic mail which is stored when created and by the recipient on receipt, would be readily accessible for subsequent reference. However, the typical chat room uses electronic exchanges without the expectation that the communications will be stored; such a use would fall foul of the provision. With instant messaging the exchange appears on each party’s computer screens and disappears after a short period of time or when the session is ended. Hence it is unavailable for subsequent reference. However, it is possible, for example, to copy and paste the exchange to a regular computer file, log the conversations, or use a screenshot or screen capture. Should the parties agree to record the exchange in this fashion, then it can be reasonable to expect that the information would be ‘readily accessible so as to be useable for subsequent reference’. Western Australia, being the last Australian state to enact an Electronic Transactions Act, and perhaps with greater time to reflect, replaced the phrase

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‘the information would be readily accessible so as to be useable for subsequent reference’ with ‘the information would be readily accessible then and for subsequent reference’. This contemplates that the parties must know at the time of creation that it was reasonable that it would be accessible for subsequent reference. That is, if it is not known at the time and only becomes reasonable to expect at a later date, the provision would not apply. ‘giving information’ For the purposes of the section ‘giving information’ is defined in each of the Australian Acts as including: making an application, making or lodging a claim, giving, sending or serving a notification, lodging a return, making a request, making a declaration, lodging or issuing a certificate, making, varying or cancelling an election, lodging an objection and giving a statement of reasons. Paragraph (b) Consent The consent precondition – that the person the information is required to be given to must consent to the information being given by means of an electronic communication – has had incongruous and unintentional consequences. The consent provision will be considered separately.55

New Zealand
The New Zealand provision avoids the use of the terms ‘requirement’ and ‘permission’, removes the condition ‘reasonable to expect’ and uses the expression ‘electronic form’. The provision is uncomplicated yet positive:
A legal requirement that information be in writing is met by information that is in electronic form if the information is readily accessible so as to be usable for subsequent reference.56

Signatures
Legislation which requires writing typically also requires a signature by the maker.57 A person who under a law is required to give a signature may, pursuant to and subject to conditions under the Electronic Transactions Acts, use an alternative method of authenticating their identity in relation to an electronic communication of information.58
55 See Consent, below. 56 Electronic Transactions Act 2002 (NZ) s18. 57 For example, legislation based on the Statute of Frauds see Conveyancing Act 1919 (NSW) s54A; Law of Property Act 1936 (SA) s26; Property Law Act 1974 (Qld) s59; Conveyancing Law of Property Act 1884 (Tas) s36; Instruments Act 1958 (Vic) s126; Statute of Frauds 1677 (Imp.) (WA) s2; Civil Law (Property) Act 2006 (ACT) s201; Law of Property Act 2000 (NT) s62. 58 Cth – s10; NSW – s9; Qld – ss14–15; SA – s8; Tas – s7; Vic – s9; WA – s9; ACT – s9; NT – s9.

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Legislation should not be based on the various functions that a signature may have in a paper-based environment. Such an approach places undue emphasis upon concepts peculiar to paper, but also risks tying the legislation to a particular state of technical development. The UNCITRAL Model Law concentrates upon two basic functions of a signature: first, to identify the author of a document and second, to confirm that the author approved the content of that document. It does not deal specifically with the integrity of the document itself.59

Australian provisions
Each of the nine Australian Electronic Transactions Acts includes a provision deeming electronic signatures on certain conditions to meet the requirements under the law of signatures:
If, under a law of this jurisdiction, the signature of a person is required, that requirement is taken to have been met in relation to an electronic communication if: (a) a method is used to identify the person and to indicate the person’s approval of the information communicated, and (b) having regard to all the relevant circumstances at the time the method was used, the method was as reliable as was appropriate for the purposes for which the information was communicated, and (c) the person to whom the signature is required to be given consents to that requirement being met by way of the use of the method mentioned in paragraph (a).60

The Australian signature provision is substantially similar to the ‘writing’ provision.61 Curiously, however, whereas the provision regarding writing applies where there is a requirement for writing or where writing is permitted, the provision for signatures only applies where the signature is required. This provision does not deem functional equivalence to signatures where they are not required, but are simply permitted. For example, where a signature is used as corroborating evidence proving the existence of a contract or transaction where the signature was not required, the Electronic Transactions Acts have no application. The acceptability and equivalence of an electronic signature in such circumstances should be a matter for the common law. The limited cases and commentaries have to date ignored this point. Again, let us now examine the provision in detail. ‘signature of a person’ ‘Signature of a person’ is a surprisingly thorny concept.62 The meaning, and the use and custom, of a signature have been many and varied. Person can
59 See Official Guide to Enactment of the UNCITRAL Model Law on Electronic Commerce. 60 NSW – s9(1); Qld – s14; SA – s8(1); Tas – s7(1); Vic – s9(1); WA – s9(1); ACT – s9(1); NT – s9(1). The Commonwealth has substantially similar provisions in s10(1), but also makes special provision for Commonwealth entities. 61 See above. 62 See Chapter 5.

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mean an individual or corporation. The signature of a corporation can be its corporate seal accompanied by one or more officers’ personal signatures. The seal may be a rubber stamp, impressed indentation into paper or even a wax seal. Traditional signatures most typically are physically written, printed or impressed. They can be readily reproduced by the maker and recognised and identified by other parties and experts. To varying degrees they are difficult to forge. Traditional signatures have acquired such ‘fungibility’ that they have been the standard for identification and for the execution of legal instruments, and used in financial institutions, for credit cards, accounts, cheques and so forth. Additionally, alteration and removal are difficult. When faced with a new form of signature the common law courts looked to the accepted functions and purposes of signatures and to the signatory’s intention to determine if the electronic signature offered the same. ‘signature of the person . . . in relation to an electronic communication’ The type of signature envisaged by the provision is an ‘electronic signature’, although that expression is not used. Instead the provision applies to the broader expression, ‘signature of the person . . . in relation to an electronic communication’. There is no definition of electronic signature in the Australian legislation. The common law courts would most likely look to the pertinent attributes of a traditional signature to determine whether a given electronic signature meets legal requirements. The term ‘electronic signature’ should not be confused with ‘digital signature’. The latter refers to a specific attachment which uses an asymmetric cryptosystem, a hash function and public and private ‘keys’ for authentication and verification. An ‘electronic signature’ is any means of electronic authentication of the identity of a person and of the intent of that person associated with an electronic record. The term has no universally accepted meaning and internationally is variously defined. Paragraph (a) Method used Paragraph (a) establishes the principle that, in an electronic environment, the basic legal functions of a signature are performed by way of a method that identifies the originator of a data message and confirms that the originator approved the content of that message. In 2006 in J Pereira Fernandes SA v Mehta,63 the English courts had cause to consider the nature of an electronic signature. Mehta emailed Fernandes’ solicitors offering to provide a personal guarantee in favour of Fernandes and to make a payment of £5000 on certain terms. The email did not show Mehta’s name at the foot of the message, but was described in the header as having come from

63 [2006] EWHC 813.

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‘Nelmehta@aol.com’. On receiving the email, a clerk employed by the solicitors telephoned Mehta and agreed to the proposal. The solicitor then sent a written guarantee to Mehta. However, Mehta did not sign or return it. Judge Pelling QC held that the email would be a note or memorandum to which section 4 of the Statute of Frauds applied. However, his Honour also considered whether or not it was sufficiently signed:
a party can sign a document for the purposes of Section 4 by using his full name or his last name prefixed by some or all of his initials or using his initials, and possibly by using a pseudonym or a combination of letters and numbers (as can happen for example with a Lloyds slip scratch), providing always that whatever was used was inserted into the document in order to give, and with the intention of giving, authenticity to it.64

In determining what would amount to a signature Judge Pelling QC examined the underlying purpose. His Honour stated that the purpose of the Statute of Frauds:
is to protect people from being held liable on informal communications because they may be made without sufficient consideration or expressed ambiguously or because such a communication might be fraudulently alleged against the party to be charged.65

In relation to an electronic document his Honour commented that:
if a party creates and sends an electronically created document then he will be treated as having signed it to the same extent that he would in law be treated as having signed a hard copy of the same document. The fact that the document is created electronically as opposed to as a hard copy can make no difference.66

The issue before the court was whether the automatic insertion of a person’s email address after the document has been transmitted constitutes a signature for the purposes of Statute of Frauds. His Honour’s conclusion was an email address insertion was ‘incidental’. The header is ‘divorced from the main body of the text of the message’. If there is no further evidence in relation to the maker’s intention, ‘it is not possible to hold that the automatic insertion of an email address is . . . intended for a signature’. To conclude otherwise would, in his Honour’s view, undermine or potentially undermine the purpose of the Statute of Frauds. ‘electronic communication’ The expression ‘electronic communication’ is defined as:
(a) a communication of information in the form of data, text or images by means of guided or unguided electromagnetic energy, or both, or

64 [2006] EWHC 813, para 26. 65 [2006] EWHC 813, para 16. 66 [2006] EWHC 813, para 28.

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(b) a communication of information in the form of sound by means of guided or unguided electromagnetic energy, or both, where the sound is processed at its destination by an automated voice recognition system.67

This gives a media neutral and technology neutral approach to the provision to apply to as broad a range of circumstances as possible. ‘a method used to identify the person and to indicate the person’s approval’ This expression is used in place of the simpler concept of ‘electronic signature’. It ensures technology neutrality. The ‘method used’ could be as simple as a sender typing a name at the end of an email,68 or an unseen digital signature logically associated and integrated with an electronic file authenticating the identity of the sender to a mathematical certainty and ensuring the integrity of the message.69 The former is insecure. Anyone can type such a signature. Some email senders may place a digitised image of their signature at the end. This is equally insecure, as anyone can cut and paste the image. The ‘method used’ could be a simple code. Two parties may by agreement determine that, for example, the number ‘37’ should be placed at the end with the intention that it will signify both the identity and approval of the sender. Others may improve on this rudimentary approach and require the code to be dynamic, yet simple; such as today’s date multiplied by five plus the number of the month multiplied by eight. The resulting number appearing at the end of each email appears random, and yet the parties accept by agreement with some deal of certainty and security the authenticity and integrity of the message.70 Digital signatures that use an asymmetric cryptosystem, or public and private ‘keys’ and a hash function, to ensure authentication and verification of the message and authorship are very secure. Paragraph (b) Reliability of the method used Paragraph (b) provides a flexible approach to the level of security to be achieved by the method of identification used under paragraph (a). In determining whether or not the method used is appropriate, legal, technical and commercial factors should be taken into account. These might include, for example:
• the sophistication of the equipment used by each of the parties; • the nature of their trade activity; • the frequency with which commercial transactions take place between the parties; • the kind and size of the transaction; • the function of signature requirements in the given statutory and regulatory environment; • the capability of communication systems;
67 68 69 70

The Commonwealth Act again limits application to ‘speech’ instead of ‘sound’. As approved by Judge Pelling QC in J Pereira Fernandes SA v Mehta [2006] EWHC 813, para 8. See Chapter 5. The example for 5 November would be 113.

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compliance with authentication procedures set forth by intermediaries; the range of authentication procedures made available by the intermediary; compliance with trade customs and practice; existence of insurance coverage against unauthorised messages; the importance and value of the information contained in the data message; the availability of alternative methods of authentication and the cost of their use; and • the degree of acceptance or non-acceptance of the method of identification in the relevant industry or field both at the time the method was agreed upon and at the time the data message was communicated.71

Although this is unstated, the provision envisages the ‘method used’ including electronic signatures. The Singapore Electronic Transactions Act 1998 contains a useful definition of ‘electronic signature’:
any letters, characters, numbers or other symbols in digital form attached to or logically associated with an electronic record, and executed or adopted with the intention of authenticating or approving the electronic record.72

This would cover the simple email signature, a code attached or appended to an email or an electronic document or the use of a digital signature.73 In Faulks v Cameron74 the NT Supreme Court considered emails that ended with the type-written words ‘Regards Angus’ and ‘Regards Angus Cameron’. The court had to determine whether the emails were ‘signed’ as a consequence of the Electronic Transactions (Northern Territory) Act 2000 (NT). With surprisingly little analysis, it was held that the emails had been signed. Young AM was satisfied that:
the printed signature on the defendant’s emails identifies him and indicates his approval of the information communicated, that the method was reliable as was appropriate and that the plaintiff consented to the method. I am satisfied that the agreement is ‘signed’.75

‘of the information communicated’ These words require a connection between the information and the signature. Hence the method used must indicate the signatory’s intention that the signature be attached to or logically associated with the information. In McGuren v Simpson76 the NSW Supreme Court regarded the words of an email ‘yes I spent the money and I shouldn’t have’, together with the name

71 72 73 74 75 76

Official Guide to Enactment of the UNCITRAL Model Law on Electronic Commerce. Electronic Transactions Act 1998 (Singapore), s2. See Chapter 5. [2004] NTSC para 61; (2004) 32 Fam LR 417. [2004] NTSC para 64. [2004] NSWSC 35, see Writing, above.

the so-called ‘authenticated signature fiction’ will apply where the party to be charged expressly or impliedly acknowledges the writing as an authenticated expression of the contract so that the typed words will be deemed to be his or her signature. This flexible technology-neutral standard enables signature methods to meet appropriate subjective standards at the time they are used. . ‘having regard to all the relevant circumstances at the time the signature method was used’. The consent provision is considered separately. because it has been typed in by the other party. as a written and signed confirmation of McGuren’s obligation to Simpson for the purposes of the Limitation Act 1969 (NSW).79 New Zealand provisions 22(1) Subject to subsection (2). .80 The New Zealand provisions for signatures are based on the UNCITRAL Model Law. The court approved the passage in Halsbury’s Laws of Australia: Where the name of the party to be charged appears on the alleged note or memorandum. the signature is required. (2) A legal requirement for a signature that relates to information legally required to be given to a person is met by means of an electronic signature only if that person consents to receiving the electronic signature. the New Zealand provisions refer specifically to 77 78 79 80 110 Contract at [110–1030].78 Paragraph (c) Consent Paragraph (c) duplicates the consent provision for ‘writing’.THE LAW OF CONTRACT 45 appearing in the email. however. See Consent. below. Electronic Transactions Bill 1999 (Cth) Explanatory Memorandum.77 The court held that the email was recognisable as a signed note of a concluded agreement: ‘the method must be as reliable as appropriate for the purposes for which the information was communicated’ . . and the circumstances in which. Paragraph (b) envisages that technological advances may result in signature technology becoming unsuitable even though it may have been suitable for a particular transaction at an earlier time. a legal requirement for a signature other than a witness’ signature is met by means of an electronic signature if the electronic signature— (a) adequately identifies the signatory and adequately indicates the signatory’s approval of the information to which the signature relates. Electronic Transactions Act 2002 (NZ) s22. for example. comments and concerns. Unlike Australia. The legislature’s intention was to link this requirement to the time that the signature method was used to ensure that a signature method that was appropriate at the time it was used is not later rendered invalid. and (b) is as reliable as is appropriate given the purpose for which. and raises the same issues.

and (ii) is as reliable as is appropriate given the purpose for which.81 The provision parallels the Australian provision in relation to being ‘as reliable as is appropriate given the purpose for which. the electronic signature of the witness— (i) adequately identifies the witness and adequately indicates that the signature or seal has been witnessed. See Consent. . the witness’ signature is required. and raises the same issues. The requirements parallel the provision in section 22. See Chapter 5. and (b) the means of creating the electronic signature was under the control of the signatory and of no other person.85 81 82 83 84 85 Electronic Transactions Act 2002 (NZ) s5. ‘Electronic signature’ in relation to information in electronic form is defined as ‘a method used to identify a person and to indicate that person’s approval of that information’. with the same impact. any alteration made to that information after the time of signing is detectable. below. and (c) any alteration to the electronic signature made after the time of signing is detectable. See Consent. The precondition that the person receiving the signature is required to be given consents to that requirement being met by way of the use of the method mentioned is considered separately. An electronic signature used to witness a document must comply with section 22 and: 23(1) (b) in the case of the witnessing of a signature or a seal. and (d) where the purpose of the legal requirement for a signature is to provide assurance as to the integrity of the information to which it relates. below.46 LAW OF ELECTRONIC COMMERCE the use of ‘electronic signatures’ and to their equivalence in set circumstances.83 The consent provision for section 22 is repeated. and the circumstances in which.84 Section 24 contains a presumption that certain electronic signatures are reliable for the purposes of the Act: 24(1) For the purposes of sections 22 and 23.82 The New Zealand Electronic Transactions Act includes a specific provision for witnessing a document by way of an electronic signature. comments and concerns. it is presumed that an electronic signature is as reliable as is appropriate if— (a) the means of creating the electronic signature is linked to the signatory and to no other person. and the circumstances in which. Section 22 duplicates the consent provision for ‘writing’. the signature is required’. This section describes the operation of a digital signature but does not preclude other secure forms of electronic signatures. Electronic Transactions Act 2002 (NZ) s23(1)(b) .

whether by means of an electronic communication or otherwise. an electronic form of the document.86 The underlying assumption of both the Model Law and the Australian legislation has been that original documents are paper based. of an electronic form of the document. Tas – s8. that requirement is taken to have been met if the person produces. and (b) at the time the communication was sent. a person is required to produce a document that is in the form of paper. by means of an electronic communication. if the maintenance of the integrity of the information cannot be assured. New Zealand – s28. and (ii) the information is readily accessible so as to be usable for subsequent reference. an article or other material may instead produce the document in electronic form: If. the person who must provide or produce the information must— (i) notify every person to whom the information is required to be provided or produced of that fact. if— (i) the form and means of the provision or production of the information reliably assures the maintenance of the integrity of the information. The Commonwealth has substantially similar provisions in s11. SA – s10. the provisions deal with an electronic equivalent. it was reasonable to expect that the information contained in the electronic form of the document would be readily accessible so as to be useable for subsequent reference. and the circumstances in which. the information is required to be provided or produced. but. an article or other material. Qld – ss16–18. or (b) in electronic form. and (c) the person to whom the document is required to be produced consents to the production. where: (a) having regard to all the relevant circumstances at the time the communication was sent. ACT – s10. but also makes special provision for Commonwealth entities. and (ii) if requested to do so. provide or produce the information in electronic form in accordance with paragraph (b). the method of generating the electronic form of the document provided a reliable means of assuring the maintenance of the integrity of the information contained in the document.THE LAW OF CONTRACT 47 Production of documents A person who is required or permitted by law to produce a document that is in the form of paper. The New Zealand Electronic Transactions Act includes a provision not foreshadowed in either of these: section 29 deals with the position where the electronic form is the original. The section aims to give a paper copy functional equivalence if certain criteria are met: A legal requirement to provide or produce information that is in electronic form is met by providing or producing the information— (a) in paper or other non-electronic form. given the purpose for which. WA – s10. NT – s10. . Vic – s10. by means of an electronic communication. and 86 NSW – s10. under a law of this jurisdiction.

89 See Writing. to allow for the authentication of data by means of a signature. 88 See Electronic Transactions Act 1999 (Cth) ss9(1)(d) . consent is required for retention and access as well as for writing. 11(1)(e) and 11(2)(e) and the state and territory equivalents. ‘A matter of consent’. The Model Law is based on ‘the recognition that legal requirements prescribing the use of traditional paper-based documentation constitute the main obstacle to the development of modern means of communication’. 91 Official Guide and Comments to the UNCITRAL Model Law of Electronic Commerce. See also CC Nicoll. The Commonwealth Parliament made certain changes to the Model Law template. The consent provision is absent from the UNCITRAL Model Law. if applicable. 92 Ibid. 93 Ibid. territories and New Zealand. to allow for the reproduction of a document so that each party would hold a copy of the same data. para 16.93 87 Electronic Transactions Act 2002 (NZ) s29. or documents produced. It has been suggested that the consent provision thwarts functional equivalence. electronic signatures and electronic production.92 They noted that: Among the functions served by a paper document are the following: to provide that a document would be legible by all. must consent to that requirement being met electronically. above. ‘Consent – Luddite’s lifeline’. . In New Zealand. (2007) 27 Proctor 7.91 The UNCITRAL drafters based the Model Law on the ‘functional equivalent approach’. ‘The Electronic Transaction Acts – in action or inaction?’. 90 Alan Davidson.48 LAW OF ELECTRONIC COMMERCE (iii) the person to whom the information is required to be provided or produced consents to the provision or production of the information in an electronic form and. Although the underlying principle of the legislation is functional equivalence. by means of an electronic communication. 47.90 The reasoning for its inclusion is ill-conceived and it creates an unwarranted impediment. 9(2)(d) . stating that it is ‘based on an analysis of the purposes and functions of the traditional paper-based requirement with a view to determining how those purposes or functions could be fulfilled through electronic-commerce techniques’. to provide that a document would remain unaltered over time. Most countries have modified the language and rules to suit their particular culture and domestic position. 25. however.88 The person to whom the electronic writing or signature is required to be given.. (2000) 9(3) Information & Communications Technology Law 195. 10(1)(d) . (2004) 24 Proctor 11. signatures and the production of documents. and to provide that a document would be in a form acceptable to public authorities and courts.89 the notion of consent was considered significant enough to override that precept. Alan Davidson. This is not unusual. which were followed by the states.87 Consent The Commonwealth Parliament introduced consent as an additional precondition for functional equivalence of electronic writing.

but does not include consent given subject to conditions unless the conditions are complied with. para 16.96 The Explanatory Memorandum to the Commonwealth’s Electronic Transactions Act states that the inclusion of the consent provision was based on the government’s: general policy that a person should not be compelled to use an electronic communication to conduct a transaction in order to satisfy requirements or permissions to give information in writing under Commonwealth law. the UNCITRAL drafters gave due attention to the existing hierarchy of form requirements. see Art. See Ilich v Baystar Corp. in most cases. The definition is intended to ensure that express consent is not required prior to every electronic communication. Ibid. Pty Ltd [2004] WASTR 25. it sets out basic functions of paper-based form requirements. especially with respect to the identification of the source and content of the data.94 The only stated reservation was that the adoption of the functional equivalent approach ‘should not result in imposing on users of electronic commerce more stringent standards of security (and the related costs) than in a paper-based environment’. Once these requirements have been met. However.97 The definition of ‘consent’ in the Australian Acts includes consent that can reasonably be inferred from the conduct of the person concerned. this statement is questionable where consideration is given to contract formation. a much higher degree of reliability and speed.95 When adopting the functional equivalent approach. . It is insufficient for the recipient to consent after receipt. provided that a number of technical and legal requirements are met. which provides distinct levels of reliability.. Instead. 49. and known to be given. 94 95 96 97 98 Ibid. For a contract to be formed utilising the deeming features of the Electronic Transactions Acts. Electronic Transactions Act 1999 (Cth) Explanatory Memorandum. traceability and unalterability with respect to paperbased documents. 11 – Formation and validity of contracts.THE LAW OF CONTRACT 49 The UNCITRAL drafters also believed that: electronic records can provide the same level of security as paper and.98 The Explanatory Memorandum states that the power only applies where a person is receiving an electronic communication and that it is not necessary to state whether or not that person consents beforehand because ‘the provisions are clearly drafted to provide a person with the ability to choose whether or not to satisfy their legal obligations by using an electronic communication’ (emphasis added). para 17. all transactions should ‘enjoy the same level of legal recognition as corresponding paper documents performing the same function’. Ibid.. The Model Law does not attempt to define a computer-based equivalent to any kind of paper document. consent must be given by the recipient.x. in advance. For example.

whether expressly. on receipt of the acceptance the offeror considers his or her position. Kronberger R stated: both the ‘giving’ of the information and the ‘consent’ are expressed in the present tense. at the time the information was given.101 The only result can be that where consent is not known in advance. consent must exist. 100 Electronic Transactions Act 2003 (WA) s8. para 11. These issues were encountered in Ilich v Baystar Corp. This is contrary to express statements in the Explanatory Memorandum. First. and a person emails an acceptance. 101 [2004] WASTR 25. although the Explanatory Memorandum was not specifically referring to contract formation. If it is known that the offeror will consent to an electronic communication of acceptance in advance. Is the contract formed at the point of communication by the offeree or when the offeror actually consents to the use of electronic writing? What if the offeror obtains legal advice regarding the electronic writing and so takes one or two weeks to consider whether or not to consent? What would be the effect should a time is of the essence provision operate during the deliberation period? To suggest that a contract is entered into not on communication but at a later time would be to create a new concept: deferred formation of contract. What is not addressed by the legislation is the timing of the formation of the contract.50 LAW OF ELECTRONIC COMMERCE Example If the law requires writing or a signature. let us ignore the postal acceptance rule and assume that the contract is formed on communication. impliedly or by prior conduct. the requirements of writing and signature are not ‘taken to have been met’ for the application of the Electronic Transactions Acts. which may well indicate a legislative intention that. and after some deliberation – minutes or days – the offeror decides to consent and all appears to be well. weighing up whether to consent to the ‘electronic’ writing and signature. If the offeror has not consented in advance. the offeror cannot enforce a contract on receiving an email acceptance. strictly. what is the effect of the consent provision on the timing of the formation of the contract? To simplify the problem. Second. . irrelevant. In other words. This seems to be the position taken by the Explanatory Memorandum. Where consent cannot be determined in advance. two possibilities arise. This leads to two unusual and perhaps surprising consequences. subsequent words or conduct are. the Act applies and the requirement of writing and signature ‘is taken to have been met’.99 The WA Strata Titles Referee determined that the language of the WA writing provision100 requires consent to be known in advance. the offeree sending the email knows that the acceptance cannot be enforced 99 [2004] WASTR 25. Assume an offer is made by letter and contains the requisite material terms and the signature of the offeror. Pty Ltd. The offeree sends an email acceptance including an otherwise acceptable electronic signature.

The Act does not state that if the preconditions are not met the electronic writing shall not be equivalent. 103 Section 5(b). These comments are made for the purposes of the application of the Electronic Transactions Acts only. There remains one significant caveat. 105 Federal Trade Commission.102 Other countries’ provisions Several others countries have included consent provisions. The drafters considered this consent provision to demonstrate that the application of the Act is to be voluntary and to allow ‘the greatest possible party autonomy to refuse electronic transactions’. The next step is to determine whether the common law would regard the electronic writing and signature as equivalent. one of the stated aims of the Model Law. 104 Uniform Electronic Transactions Act 1999 (US) s5. to the same extent that the offeree knows that on oral acceptance cannot be enforced. (2001) www. the Canadian Electronic Transactions Act 2001 states: ‘Nothing in this Act requires a person to provide. receive or retain information or a record in electronic form without the person’s consent.htm.104 The US Electronic Signatures in Global and National Commerce Act includes a similar consent provision to protect consumers. ‘Report to Congress on the Electronic Signatures in Global and National Commerce Act: The consumer consent provision in section 101(c)(1)(C)(ii)’. In a section headed ‘Use not mandatory’.gov/os/2001/06/esign7. including the parties’ conduct. 106 Electronic Transactions Act 2001 (Canada) s4.103 The Official Comments to this Act state that ‘the paradigm of this Act is two willing parties doing transactions electronically’. a contract has not been formed.THE LAW OF CONTRACT 51 against him or her.105 The Electronic Transactions Act of Ireland contains a consent provision substantially similar to that in the Australian Acts. Of course additional conduct may give the offeror a remedy using doctrines of estoppel or part performance. Whether the parties agree to conduct a transaction by electronic means is determined from the context and surrounding circumstances. and lead to incongruous unintentional results. Comment cl2. above. The Federal Trade Commission argues that the provision discourages deception and fraud by those who might fail to provide consumers with information the law requires that they receive. So the Australian consent provisions remove functional equivalence. The relevant provisions merely state that equivalence requirements are not met if certain preconditions apply. but in the absence of any other factor. The US Uniform Electronic Transactions Act 1999 contains a general provision for the application of the entire Act: This [Act] applies only to transactions between parties each of which has agreed to conduct transactions by electronic means.ftc.’106 The Official Comment explains 102 See Common law. A recipient of paper-based communications has no choice but to accept them (in terms of contract formation). Treating electronic communications differently erodes the functional equivalence principle and downgrades electronic commerce. .

Second. Instead of providing certainty by recognising equality where the electronic writing. Wilkens v Iowa Insurance Commissioner (1990) 457 NW 2d 1. 107 See Common law. above.107 Retention of information and documents The requirement to record information in writing may be met by recording the information in electronic form. McGuren v Simpson [2004] NSWSC 35. with consequences that are yet to be tested and analysed in court. . The first point. NSW – s11(1). New Zealand – s25. Where the Act does not apply the courts must turn to the common law. it explains. ACT – s11(1). Hume Computers Pty Ltd v Exact International BV [2007] FCA 478. The Act. SM Integrated Transware v Schenker Singapore Ltd [2005] 2 SLR 651. The Canadian Uniform Electronic Commerce Act provides that ‘Nothing in this Act requires a person to use or accept information in electronic form. the consent provision is futile.52 LAW OF ELECTRONIC COMMERCE that the section ensures that the Act will not be used to compel people to use electronic documents against their will. Qld – s19. in the few cases to date. and do not yet have the capacity to use them. signature or production is functionally equivalent. the relevant provision does not state that the electronic writing. SA – s11(1).’ The Official Comment to the Act explains that the section ensures that the Act will not used to compel people to use electronic documents ‘against their will’. not compulsion’. Tas – s9(1). has been made. in the end leaving such matters to the common law. that some people are still ‘uncomfortable’ with such documents and do not have the ‘capacity’ to use them. Under normal circumstances parties cannot refuse traditional paper communications and documents. Comment Two final comments are warranted to this section. The consequence is that this provision of the Act does not apply in any circumstances. the consent provision adds an unnecessary precondition creating less certainty. that the Australian consent provision thwarts functional equivalence. 108 Cth – s12(1).108 To be acceptable it must be reasonable to expect that the information will continue to be accessible for future reference and the method for storing the information must comply with any requirements of the regulations under the Act as to the kind of data storage device on which the information is to be stored. It too states that many people ‘are still uncomfortable with such documents’. NT – s11(1). but a person’s consent to do so may be inferred from the person’s conduct. Vic – s11(1). WA – s11(1). is intended to provide ‘certainty. Where there is no applicable consent. held equivalence in any event. The common has. signature or production shall not be legally and functionally equivalent.

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Retention in paper form
The requirement to retain a document in the form of paper, an article or other material for a particular period109 may be met by recording or retaining the information in electronic form.110 The requirement is taken to have been met if the person retains, or causes another person to retain, an electronic form of the document throughout that period, where:
(a) having regard to all the relevant circumstances at the time of the generation of the electronic form of the document, the method of generating the electronic form of the document provided a reliable means of assuring the maintenance of the integrity of the information contained in the document, and (b) at the time of the generation of the electronic form of the document, it was reasonable to expect that the information contained in the electronic form of the document would be readily accessible so as to be useable for subsequent reference, and (c) if the regulations require that the electronic form of the document be retained on a particular kind of data storage device–that requirement has been met throughout that period.

The integrity of information contained in a document is maintained ‘if, and only if ’111 the information has remained complete and unaltered, apart from (a) the addition of any endorsement, or (b) any immaterial change, which arises in the normal course of communication, storage or display.112

Retention in electronic form
The requirement to retain information the subject of an electronic communication for a particular time may be met by recording or retaining the information in electronic form.113 To be acceptable, that requirement is taken to have been met if the person retains, or causes another person to retain, in electronic form, the information throughout that period, provided that:
(a) at the time of commencement of the retention of the information, it was reasonable to expect that the information would be readily accessible so as to be useable for subsequent reference, and (b) having regard to all the relevant circumstances at the time of commencement of the retention of the information, the method of retaining the information in electronic form provided a reliable means of assuring the maintenance of the integrity of the information contained in the electronic communication, and (c) throughout that period, the first person also retains, or causes the other person to retain, in electronic form, such additional information obtained by the
109 The New Zealand provisions refer to ‘paper or other non-electronic form’, and do not refer to any particular period. 110 Cth – s12(2); NSW – s11(2) ; Qld – s20; SA – s11(2); Tas – s9(2); Vic – s11(2); WA – s11(2); ACT – s11(2); NT – s11(2); New Zealand – s25. 111 The Northern Territory altered this to ‘only if’. 112 This additional provision is absent from the New Zealand provision. 113 Cth – s12(4); NSW – s11(4); Qld – ss19–21; SA – s11(4); Tas – s9(4); Vic – s11(4); WA – s11(4); ACT – s11(4); NT – s11(4); New Zealand – ss26–27.

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first person as is sufficient to enable the identification of the following: (i) the origin of the electronic communication, (ii) the destination of the electronic communication, (iii) the time when the electronic communication was sent, (iv) the time when the electronic communication was received, and (d) at the time of commencement of the retention of the additional information covered by paragraph (c), it was reasonable to expect that the additional information would be readily accessible so as to be useable for subsequent reference, and (e) if the regulations require that the information be retained on a particular kind of data storage device — that requirement has been met throughout that period.

The requirements for origin, destination and time are aimed at electronic mail. The application to other technologies such as SMS messaging, instant messaging and chat rooms where communication is often effectively instantaneous may prove problematic. As with the previous requirement to retain in a paper form, the integrity of information contained in a document is maintained ‘if, and only if ’114 the information has ‘remained complete and unaltered, apart from the addition of any endorsement, or any immaterial change, which arises in the normal course of communication, storage or display’.115

Time and place of dispatch and receipt of electronic communications
The time and place of the dispatch and receipt of electronic communications can have significant impact in commerce, particularly in the law of contract. Strict rules have developed in relation to the time and place of offer and acceptance in contract law. This may have a bearing on the applicable jurisdiction or contract formation. The Electronic Transactions Acts of Australia and New Zealand include provisions based on the UNCITRAL Model Law that attempt to resolve uncertainties in this area. However, the application of the provisions raises serious questions. The time of dispatch and time of receipt must be considered in conjunction with common law rules of offer and acceptance and the timing of contract formation. One must also ask whether the postal acceptance rule can or should apply to electronic mail and other forms of electronic communications and, if it does, how it interacts with the legislation.

114 The Northern Territory altered this to ‘only if’. 115 Cth – s12(3); NSW – s11(3); Qld – s 20(3); SA – s11(3); Tas – s9(3); Vic – s11(3); WA – s11(3); ACT – s11(3); NT – s11(3); this additional provision is absent from the New Zealand provision.

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Time of dispatch
(1) For the purposes of a law of this jurisdiction, if an electronic communication enters a single information system outside the control of the originator, then, unless otherwise agreed between the originator and the addressee of the electronic communication, the dispatch of the electronic communication occurs when it enters that information system. (2) For the purposes of a law of this jurisdiction, if an electronic communication enters successively 2 or more information systems outside the control of the originator, then, unless otherwise agreed between the originator and the addressee of the electronic communication, the dispatch of the electronic communication occurs when it enters the first of those information systems.116

The dispatch of the electronic communication occurs when it enters an information system outside the control of the originator. In the most typical case this would be when the originator clicks the ‘Send’ button of an email. The broad term ‘electronic communication’ applies to emails, SMS messages, present and future technologies. The provision for time of dispatch is a default rule. The parties may have ‘otherwise agreed’ to alternative arrangements. In Szaeg v Minister for Immigration,117 the court applied the Commonwealth Electronic Transactions Act to Australia Post’s facsimile service, finding that the sender’s document was dispatched when ‘handed’ to an employee of Australia Post, because that system was outside the control of the originator. Problems arise with regard to email and communication systems not envisaged when this provision was drafted by UNCITRAL in 1996. Today, some systems permit the originator to recall an email before it has been flagged as read. However, it may be possible that the recipient could ‘read’ the name of the sender and the subject line without formally opening the email. If we assume the subject line contained an acceptance to an offer with words such as, ‘Your offer accepted unconditionally’, a paradox arises. The email is ‘received’ according to the Act; and the acceptance has been communicated as required by the rules of contract at common law; and yet according to the Electronic Transactions Acts it has not been dispatched. The courts are yet to consider this. In this situation, the provision is not triggered. This is a result not anticipated by the legislators, but one which can, in any event, be resolved by applying common law principles. This is another area in which the legislation is redundant and somewhat ineffectual. The New Zealand provision in relation to the time of dispatch is much less verbose than the Australian equivalents, but contains the same notions and principles:

116 NSW – s12; other Australian jurisdictions have identical or substantially identical provisions; Cth – s14; Qld – s23; SA – s13; Tas – s11; Vic – s12; WA – s13; ACT – s13; NT – s13. 117 [2003] FMCA 258.

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An electronic communication is taken to be dispatched at the time the electronic communication first enters an information system outside the control of the originator.118

Time of receipt
(3) For the purposes of a law of this jurisdiction, if the addressee of an electronic communication has designated an information system for the purpose of receiving electronic communications, then, unless otherwise agreed between the originator and the addressee of the electronic communication, the time of receipt of the electronic communication is the time when the electronic communication enters that information system. (4) For the purposes of a law of this jurisdiction, if the addressee of an electronic communication has not designated an information system for the purpose of receiving electronic communications, then, unless otherwise agreed between the originator and the addressee of the electronic communication, the time of receipt of the electronic communication is the time when the electronic communication comes to the attention of the addressee.119

‘Designated information system’ is not defined in the Australian or New Zealand legislation nor in the Model Law, but ‘information system’ is defined as:
a system for generating, sending, receiving, storing or otherwise processing electronic communications.120

The system would be designated when an email address or mobile phone number has been communicated by the addressee to the originator. However, the path of an electronic communication may be quite complex. For example, with a typical email, once sent, the email enters the internet, going from router to router. It then enters the addressee’s Internet Service Provider (ISP), if it is operational. At a later time the addressee’s computer will contact the ISP to check for updates. This may be done when the addressee turns on the computer, or automatically at regular intervals. In any event the email will be passed onto the addressee’s computer. Debate arises whether the legislature intended the internet, the ISP or the addressee’s computer to be the designated information system.121 Most likely it is the ISP, which relates to that part of an email address to the right of the ‘@’ sign. In Szaeg v Minister for Immigration,122 a facsimile application was handed to an Australia Post employee. The court found that the facsimile ‘was sent to some address unknown [and] it was not received by the [addressee] . . . the facsimile transmission . . . did not enter the [addressee’s] designated information system for the purposes of s14(3) of the Electronic Transactions Act 1999 (Cth)’.123
118 Electronic Transactions Act 2002 (NZ) s10(1). 119 NSW – s12; other Australian jurisdictions have identical or substantially identical provisions; Cth – s14; Qld – s24; SA – s13; Tas – s11; Vic – s12; WA – s13; ACT – s13; NT – s13. 120 Cth – s5; NSW – s5; Qld – schedule 2; SA – s5; Tas – s3; Vic – s3; WA – s5; ACT – dictionary; NT – s5. 121 For example see Patrick Quirk and Jay Forder, Electronic Commerce and the Law, 2nd edn, Wiley Press, Brisbane, 2003, p. 67. 122 [2003] FMCA 258. 123 [2003] FMCA 258, para 25.

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In itself the provision can form a quasi postal acceptance rule, as the email is deemed received before communication. The problem is complicated by rules relating to acceptances and, in common law countries, by the possible application of the postal acceptance rule. Where an information system is not designated an email is deemed received when it ‘comes to the attention of the addressee’. It remains unclear whether the words ‘comes to the attention of the addressee’ mean when the addressee has read the communication or when the addressee has received a notice, such as, ‘you have mail’. Potentially, a recipient could note that an email has been received from the offeree, and deliberately avoid reading it until the offer lapses. This issue must await a court’s deliberation. As with the time of dispatch, the New Zealand provision, in relation to the time of receipt, is much less verbose than the Australian equivalents, but contains the same notions and principles. For New Zealanders, the time of receipt is:
(a) in the case of an addressee who has designated an information system for the purpose of receiving electronic communications, at the time the electronic communication enters that information system; or (b) in any other case, at the time the electronic communication comes to the attention of the addressee.124

Acceptance by electronic communication and the postal acceptance rule
Contracts are formed only when there is a meeting of the minds. There is an offer and a corresponding acceptance. The general common law principle is that acceptance must be communicated to the offeror, at which point a legally enforceable contract comes into existence. However, from the 19th century cases of Henthorn v Fraser,125 based on Adams v Lindsell,126 an exception known as the postal acceptance rule arose. As propounded by Lord Herschell in the former case:
Where the circumstances are such that it must have been within the contemplation of the parties that . . . the post might be used as a means of communicating the acceptance of an offer, the acceptance is complete as soon as it is posted.127

This exception applies whether the letter is delivered, delayed or even lost. It has been regarded by the House of Lords as a rule of ‘commercial expediency’ and as a ‘foundation of convenience’.128 Without the rule the acceptor may be placed in an uncertain position, not knowing when or whether the acceptance had been duly received and communicated. The rule avoids the necessity of a confirmation and of a confirmation of the confirmation ad infinitum.
124 125 126 127 128

Electronic Transactions Act 2002 (NZ) s11. [1892] 2 Ch 27. (1818) B & Ald 681. [1892] 2 Ch 27, 33. Lord Wilberforce, in Brinkibon Ltd v Stahag Stahl [1983] 2 AC 34.

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While the rule has been held to apply to telegrams, the courts have been reluctant to extend the principle. They have consistently held that it does not apply to instantaneous forms of communication such as the telephone and (in some cases) telexes. In Entores Ltd v Miles Far East Corp.129 Lord Denning discussed various scenarios, such as acceptance shouted across a river which was not heard due to a passing plane, the telephone going dead, and where a recipient informs a sender of the failure of the teleprinter during the transmission of a telex. Initially Lord Denning commented: ‘In all the instances I have taken so far, the man who sends the message of acceptance knows that it has not been received or he has reason to know it. So he must repeat it.’ However, he then considered the position where the sender does not know the acceptance had not been communicated. Perhaps ‘the listener on the telephone does not catch the words of acceptance’ and does not ask that the words be repeated; or ‘the ink on the teleprinter fails at the receiving end’ and the clerk does not ask for the message to be repeated. As a result ‘the man who sends an acceptance reasonably believes that his message has been received . . . The offeror in such circumstances is clearly bound because he will be estopped from saying that he did not receive the message of acceptance. It is his own fault . . . ’130 However, his Lordship continued, if the offeror ‘without any fault on his part does not receive the message of acceptance – yet the sender of it reasonably believes it has got home when it has not – then I think there is no contract’.131 Parker LJ in the same case notes that although the operation of a telex ‘is not completely instantaneous, the parties are to all intents and purposes in each other’s presence, just as if they were in telephonic communication’.132 The same cannot be said of all electronic communications. The parties often regard the communications as akin to mail. There may be no expectation of being in each other’s presence. In Brinkibon Ltd v Stahag Stahl und Stahlwarenhandelsgesellschaft mbH133 the House of Lords confirmed on the facts before them that the telex should be treated as instantaneous communication. However, Lord Wilberforce qualified the principle. Although it was still too early to consider electronic mail his Lordship set out a number of guidelines, reminiscent of electronic mail use, which could be used to assess whether a form of communication might have the postal acceptance rule applied to it:
The message may not reach, or be intended to reach, the designated recipient immediately: Messages may be sent out of office hours, or at night, with the intention, or upon the assumption, that they will be read at a later time. There may be some error or default at the recipient’s end which prevents receipt at the time contemplated and believed in by the sender. The message may have been sent and/or received through

129 130 131 132 133

[1955] 2 QB 327. [1955] 2 QB 327, 333. [1955] 2 QB 327, 333. [1955] 2 QB 327, 337. [1983] 2 AC 34.

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machines operated by third persons. And many other variations may occur. No universal rule can cover all such cases: they must be resolved by reference to the intention of the parties, by sound business practice and in some cases by a judgment where the risks should lie.134

There is no blanket rule: as Lord Wilberforce noted, ‘no universal rule can cover all such cases’. The mistake made by many commentators has been to examine only the technology and to categorise it as instantaneous or not. This has led to misdirection. The correct approach should be to examine the use of the technology, as described by Lord Denning in Entores’ case and Lord Wilberforce above. There have been misgivings about the blanket categorisation of the telex and facsimile as instantaneous. When employed via third parties (indeed on occasions through the post office) similar delays, if not identical delays, occur as occur with standard post. If the use anticipates such delay, there is no reason in principle that the postal acceptance rule should be regarded as inapplicable. Messenger systems and chat rooms provide users with effectively real-time communications that should be categorised as instantaneous. Acceptance of offers made using such technology should follow the rule of acceptance on communication. Acceptances may be by numerous means – voicemail, VOIP, SMS messaging, bulletin boards, electronic mail, to name a few. To classify the application of the 19th century rule based purely on whether or not it can be instantaneous is fraught with danger. Some technologies may be used in more than one way: like the post and in an instantaneous manner. Email is sometimes used as a chat room or instant messaging. Two users may send and receive numerous emails within a matter of minutes. It may be conversational, with questions and answers clarifying each other’s position before a formal offer and acceptance occurs. This use of communications should be regarded as instantaneous, in which case the general ‘communication acceptance rule’ ought to apply. Similar use of other technology should be treated likewise. However, some users utilise electronic mail like standard mail. A given office’s protocol may be to access email once per day and then carefully draft a reply for sending later in the day. Such an office may require a supervisor to check the contents of all mail before it is sent, whether it is standard or electronic mail. Once approved, the electronic mail may be sent in one batch, for example at a time similar to the dispatch of regular mail. Clearly this use would be more akin to standard mail. The focus of the application of the rule should be on the use, bearing in mind Wilberforce’s threefold test of intention, sound business practice and risk. Four scenarios may be considered in determining whether and how the postal acceptance rule should apply to electronic communications:
134 [1983] 2 AC 34, 42.

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1

2

3 4

The postal acceptance rule does not apply because the Electronic Transactions Acts override the common law and specifically provide that ‘receipt’ occurs when the email enters the recipient’s ‘designated information system’. Hence it is the intention of the legislature that a quasi postal acceptance rule applies to electronic communications. The postal acceptance rule does not apply to electronic communications because such communications are to be regarded as instantaneous communications. The postal acceptance rule applies to electronic communications independently of the Electronic Transaction Acts. The postal acceptance rule applies in circumstances involving commercial expediency, depending upon intention of the parties and use.

The first approach is unsustainable because the underlying stated rationales of the Electronic Transactions Acts do not deal directly with contracts or the postal acceptance rule.135 The Acts are designed to deal with a broad range of electronic transactions. The second and third approaches presume that the postal acceptance rule is technology based. This is a misconception perpetuated by scant reading of the cases. The cases refer to use, intention, sound businesses practice and risk. For example Lord Wilberforce in Brinkibon’s case136 envisaged circumstances where facsimiles may nevertheless be subject to the postal acceptance rule. The fourth approach looks to the ramifications of usage, such as the inconvenience of delay in the context of intention, business practice and commerce. If the intention of the parties cannot be determined, the ‘rule of commercial expediency’ should apply. Today, commercial parties have at their disposal numerous methods of communication virtually beyond comprehension at the time of Lord Denning in Entores’ case and Lord Wilberforce in Brinkibon’s case. Prophetically, Lord Brandon stated, in Brinkibon’s case:
The reason for the exception is commercial expediency . . . That reason of commercial expediency applies to cases where there is bound to be a substantial interval between the time when the acceptance is sent and the time when it is received. In such cases the exception to the general rule is more convenient, and makes on the whole for greater fairness, than the general rule itself would do.137

Where the parties’ intention is that communications shall be electronic and there is expected to be, and is, a substantial interval between the time when the acceptance is sent and the time when it is received, the postal acceptance rule ought to apply. The rationale remains commercial expediency, sound business practice and an appropriate assessment of risk.
135 See Electronic Transactions Bill 1999 (Cth) Explanatory Memorandum. 136 [1983] 2 AC 34. 137 [1983] 2 AC 34, 48.

but registrants typically a variation. such as Hotmail or Yahoo.com. johndoe3120@hotmail. (6) For the purposes of the application of subsection (5) to an electronic communication: (a) if the originator or addressee has more than one place of business. and (b) if the originator or addressee has more than one place of business. Vic – s12. Nevertheless the impersonation remains. but are much less verbose. The parties may have ‘otherwise agreed’ to alternative arrangements. Cth – s13. New Zealand – ss12–13. instant and SMS messages. or the forum. using the actual email system on the computer. However. 139 Hotmail and other such email services are so popular that a given name may not be available. and one of those places has a closer relationship to the underlying transaction–it is to be assumed that that place of business is the originator’s or addressee’s only place of business. However. SA – s13. sends a 138 NSW – s12. WA – s13. The electronic text can be indistinguishable regardless of the source. The New Zealand provisions contain the same principle. an impersonator could register a person’s name and send an email as johndoe@hotmail. to whom do we attribute the message? For example using one of the popular public email services. and (c) if the originator or addressee does not have a place of business–it is to be assumed that the originator’s or addressee’s place of business is the place where the originator or addressee ordinarily resides. in the event of a dispute. . Tas – s11. for example a number. unless otherwise agreed between the originator and the addressee of an electronic communication: (a) the electronic communication is taken to have been dispatched from the originator’s place of business. and (b) the electronic communication is taken to have been received at the addressee’s place of business. Attribution of electronic communication Traditional forms of paper-based communications can be typically attributed to the author by such factors as handwriting. ACT – s13.com. Qld – s25. It is not proposed to deal with the various rules of private international law and domestic conflict of laws rules here. circumstances may arise where the place of contract formation determines which laws or which forum may be applicable. but paragraph (a) does not apply–it is to be assumed that the originator’s or addressee’s principal place of business is the originator’s or addressee’s only place of business. Again the term ‘electronic communication’ applies to emails. present and future technologies. other Australian jurisdictions have identical or substantially identical provisions. NT – s13. The provision is a default rule. signature and letterhead.138 These rules are important in determining the law to be applied. Electronic communications can be generic.139 A second example is where the impersonator accesses another’s computer and.THE LAW OF CONTRACT 61 Place of dispatch and place of receipt (5) For the purposes of a law of this jurisdiction.

It noted that the use of signatures on paper for commerce at a distance (by mail or facsimile) involves the risk of forged or unauthorised signatures but there is no general legislative rule that entitles the addressee to presume that the signature is genuine. ACT – s14(2). Vic – s14(2). in order to ascertain whether the communication is of the originator. Vic – s14(1). Importantly. WA – s14(2). addressees of electronically signed data messages would be better placed than those who received manually signed paper-based messages. WA – s14(1). Art.141 The Australian Acts preserve the law of agency. 141 UNCITRAL Model Law of Electronic Commerce. the recipient properly applied a procedure previously agreed to for that purpose. The recipient of such a message has every indication that the message is genuine. Authority includes delegation. agency and the employer–employee relationship. unless there is some culpability. In addition.62 LAW OF ELECTRONIC COMMERCE message. Qld – s26(2). 13. the Model Law provides for a presumption that the purported originator is in fact the originator. or the communication as received resulted from the actions of a person whose relationship with the originator. which is quoted in full in Appendix B. or with any agent of the originator. A person is not bound by an electronic communication unless the communication was sent by. 140 Cth – s15(1). Culpability may arise through estoppel or negligence. SA – s14(2). NT – s14(1). the parties may agree to exclude this provision in advance. This Australian provision differs from the UNCITRAL Model Law. Tas – s12(2). Such authority may be given ostensibly or impliedly in accordance with agency principles. enabled that person to gain access to a method used by the originator to identify the electronic communication as his or her own. The disadvantage is that a person receiving an apparently genuine message may be faced with a subsequent argument or defence that it was sent without authority.140 In the paper world a person is not bound by forgeries or communications sent without authority. . NT – s14(2). SA – s14(1). The advantage of the Australian approach is its functional equivalence. the purported originator of the electronic communication is bound by that communication only if the communication was sent by the purported originator or with the authority of the purported originator. ECEG argued that the UNCITRAL proposal favoured electronic commerce over paper-based communication. NSW – s14(1) . or with the authority of. NSW – s14(2). Tas – s12(1). Qld – s26(1). 142 Cth – s15(2).142 The decision to reject the UNCITRAL model follows a recommendation made by the Electronic Commerce Expert Group (ECEG). that person: unless otherwise agreed between the purported originator and the addressee of an electronic communication. The recipient may act on the electronic communication where. The Australian Electronic Transactions Acts resolve this conundrum in a manner that is functionally equivalent to that of the paper world. ACT – s14(1). If the UNCITRAL proposal was accepted.

143 The Australian legislators choose not to include a provision dealing with originals. These provisions override the general provisions of the Act. Originals The New Zealand Electronic Transactions Act includes a provision dealing with originals:143 A legal requirement to compare a document with an original document may be met by comparing that document with an electronic form of the original document if the electronic form reliably assures the maintenance of the integrity of the document. Careful consideration will need to be given to transactions to be exempted by the regulations and legislation. There are several stylistic changes. used. served and communicated in electronic form.145 Electronic Case Management System Part 2A of the Electronic Transactions Act 2000 (NSW) includes specific provisions for electronic documents to be used in a court which has adopted the Electronic Case Management System. Part 2A permits the NSW Attorney General to establish an electronic case management system to enable documents with respect to legal proceedings to be created. Though the states and territories generally resisted divergences in an attempt to maintain national uniformity.144 The section is predicated on the assumption that the original document is a hardcopy. 144 Electronic Transactions Act 2002 (NZ) s30. Comment The impact of the legislation will be broad.THE LAW OF CONTRACT 63 The New Zealand Electronic Transactions Act does not include an attribution provision. Within Australia the differences between the states and territories’ legislation must be noted. which a court may regard as deliberate and significant in a given factual situation. . No provision exists where the original is the electronic document. 8. issued. particularly in the Queensland legislation. extending beyond internet transactions. The UNCITRAL Model Law makes the same narrow assumption. completely uniform legislation would be preferable. 145 Art. stability and certainty. The result should be that the courts apply the same standards for non-electronic communications.

giving rise to confusion and inconsistencies. with consideration being given to their repeal. Further reading Sharon Christensen. (2003) 10(3) E Law – Murdoch University Electronic Journal of Law (MurUEJL). However.html.edu. The exemptions under the Commonwealth legislation are so broad as to frustrate the Act’s operation. William Duncan and Rouhshi Low. Although the Electronic Transactions Acts create a regulatory regime for the use of electronic communications in transactions they do not remove any legal obligations that may be imposed upon a person by other laws. A major joint state and territory review is recommended.146 The analysis of the provisions of the legislation.au/elaw/issues/v10n3/christensen103. The exemptions are inconsistent across jurisdictions.lawcom. production and retention requirements are superfluous. ‘The requirements of writing for electronic land contracts – the Queensland experience compared with other jurisdictions’. An international approach provides a level of uniformity that is a desirable if not necessary factor for international commerce. The writing. the misconceived consent requirement and the advent of new and changing technologies not considered by the legislators all lead to the conclusion that the legislation should be reviewed. with a view to curtailing unwarranted and undesirable provisions and enacting streamlined uniform legislation. The limited cases to date support this view. . recommended that there was ‘no need’ for legislation based on the UNCITRAL Model Law for most purposes: We conclude that in most contexts e-mails (and attachments) and website trading (but not EDI) are already capable of satisfying the statutory form requirements existing in English law in the areas considered in this Advice.uk/docs/e-commerce. in its paper ‘Electronic Commerce: Formal requirements in Commercial Transactions – Advice from the Law Commission’. 147 Paragraph 2. It was introduced before the courts had the opportunity to adequately apply common law precepts to the new technologies and circumstances. above. www. available at: www. McGuren v Simpson [2004] NSWSC 35. the legislation is largely unnecessary and often redundant. Electronic Commerce: Formal requirements in Commercial Transactions – Advice from the Law Commission.64 LAW OF ELECTRONIC COMMERCE The major advantage of legislation based on the UNCITRAL Model Law is that it provides an even starting platform for national legislatures.147 The consent provisions are ill-considered and unsound. 146 See Common law. Hume Computers Pty Ltd v Exact International BV [2007] FCA 478 and SM Integrated Transware v Schenker Singapore Ltd [2005] 2 SLR 651. signature.gov.15.pdf. To that extent we suggest that there is no need to consider adoption in this country of the UNCITRAL Model Laws. The major purpose of the Acts is to enable people to use electronic communications in the course of business operations and to satisfy their legal obligations.murdoch. The Law Commission for England and Wales.

The author was a Commissioner on the National Conference of Commissioners on Uniform State Laws at the time of the drafting.THE LAW OF CONTRACT 65 Henry Gabriel. D Witte. ‘The new United States Uniform Electronic Transactions Act: Substantive provisions.org/english/publications/review/articles/2000– 4.htm. Minyan Wang.unidroit. Also see Uniform Electronic Transactions Act 1999 (US) s5(b) Comment para 4. www. (2006) 15(3) International Journal of Law and Information Technology. . drafting history and comparison to the UNCITRAL Model Law on Electronic Commerce’. ‘Comment: Avoiding the un-real estate deal: Has the Uniform Electronic Transactions Act gone too far?’. (2002) 35 John Marshall Law Review 311 at 321. ‘The impact of information technology development on the legal concept – a particular examination on the legal concept of “signatures” ’.

(1877) 2 CPD 416. The online contracts are typically entered into without paper. Thornton v Shoe Lane Parking Station [1971] 2 QB 163. for train travel. 2 [1971] 2 QB 163. parking or dry cleaning. referring to an extremely onerous exclusion of liability clause on a parking ticket. local and global.4 Shrinkwrap. negotiate or agree. music and videos are just some of the many commercial transactions carried out in cyberspace. The courts have been required to determine the point of time at which these contracts are entered into and their terms and conditions . Parker v The South Eastern Railway Co. The starting point has been determining which terms are to be incorporated into the contract. More than a trillion dollars in trade is transacted online annually. clickwrap and browsewrap contracts Online commerce.1 The typical ticket case scenario arises where a person is handed a ticket – for example. The ticket may state that the holder is subject to terms which the holder may have had little or no chance to read. clickwrap and browsewrap cases. 66 . Sydney City Council v West (1965) 114 CLR 481. which have explored how contracts may be entered into and how conditions may be incorporated into the transaction. In Thornton v Shoe Lane Parking Station2 Lord Denning. stated: 1 For example. has become commonplace in the past two decades. notice or click of the mouse has raised questions reminiscent of the contract cases known as the ticket cases. This chapter also mentions contracts entered into by electronic agents. Numerous traders have embraced the new opportunities by creating global meeting places and auction houses such as eBay and amazon. travel. The sale of software. without the use of a pen and without the use of the spoken word. books. Accepting terms and conditions by conduct. cars. This chapter examines cases known as the shrinkwrap. Olley v Marlborough Court [1949] 1 KB 532.

5 The initial response was to limit the application of such clauses. The major criticism of such contracts is that the consumer will be bound by terms and conditions unknown at the time the contract is entered into. However. In Step-Saver Data Sys Inc. Dilbert: Too late. He opened software yesterday. a choice of law and forum clause. limitations of warranties and limitations of remedies. disclaimers. it would need to be printed in red ink with a red hand pointing to it – or something equally startling. Scott Adams parodied shrinkwrap contracts thus: Dilbert: I didn’t read all of the shrinkwrap license on my new software until after I opened it. In a Dilbert cartoon. CLICKWRAP AND BROWSEWRAP CONTRACTS 67 It [the exclusion clause] is so wide and so destructive of rights that the court should not hold any man bound by it unless it is drawn to his attention in the most explicit way . such as the opportunity to access terms and conditions and the extent to which such clauses will be binding. The software packages typically include a notice saying that by opening the shrinkwrap.7 the appeal court noted that it would be impossible to print the entire contract on the exterior of the box. It is interesting that as early as 1997 the problem was perceived to be broad enough to warrant public parody. 4 [1989] 1 QB 433. 3d 1447 (7th Cir 1996).3 Similarly. Apparently I agreed to spend the rest of my life as a towel boy in Bill Gates’ new mansion. clickwrap and browsewrap cases. Shrinkwrap Shrinkwrap contracts derive their name from the clear plastic wrapping that encloses the goods (such as software packages). Dilbert. Now he’s Bill’s laundry boy.. The principles of the ticket cases. The court found that: 3 [1971] 2 QB 163. the purchaser agrees to the terms and conditions enclosed. In order to give sufficient notice. 2d 91 (3d Cir 1991). later. reasonable notice must be given. in ProCD Inc. 14 January 1997. have been explored and paralleled progressively in the shrinkwrap. 170. 5 Scott Adams. v Wyse Tech6 the court held that the terms of the shrinkwrap licence were not enforceable because Step-Saver had not assented to them. Such contracts typically include provisions such as an arbitration clause. Dogbert: Call your lawyer. 7 86 F. Such an approach is prophetic for contracts in cyberspace. . 6 939 F. . in Interfoto Picture Library Ltd v Stiletto Visual Programmes Ltd4 the English Court of Appeal held that to incorporate onerous terms into a contract.SHRINKWRAP. United Feature Syndicate Inc. v Zeidenberg. .

for example. The vendor can dictate the number of steps for the user to pass through before reaching the assent stage. 9 105 F. and to the purchase of tickets for concerts. The contract needs no paper or signature. A clickwrap contract is formed on the internet. in 1998.. In Hill v Gatway 2000 Inc. 416. with a clickwrap contact. However.’10 Clickwrap Clickwrap agreements are a method of including terms and conditions in an online contract.13 An email account would be allocated to the user only after the user clicked an ‘I agree’ button which listed hotmail’s specific terms and conditions.12 At the time.9 Easterbrook J commented that cashiers and sales personnel cannot be expected to read the terms of each contract to the customer before ringing up the sale. 13 By 2008 the number had grown to more than 400 million. ‘Agree’ or ‘I accept’. His Honour concluded. terms on the inside. Hotmail provided free email services to more than 10 million customers. ‘I agree’ or ‘Yes’ and then click a send button. .68 LAW OF ELECTRONIC COMMERCE notice on the outside. The trader must take reasonable steps to bring the terms and conditions to the attention of the buyer at or before the time the contract is formed. and a right to return the software for refund if the terms are unacceptable . read or unread. which is most significant. for example. In the typical situation the vendor uses an interactive web page which may ultimately require personal and credit card details.11 The first decision on the enforceability of clickwrap contracts was Hotmail Corp. 3d 1147 (7th Cir 1997). The first is ‘type and click’. There are no Australian or New Zealand cases to date. . 10 105 F. 11 Parker v The South Eastern Railway Company (1877) 2 CPD 416. 12 47 USPQ 2d 1020 (1998). the distribution of software online. v Van$ Money Pie Inc. spam. 1149. may be a means of doing business valuable to buyers and sellers alike. ‘Competent adults are bound by such documents. the user. Assent is given in one of two principal methods. These included the prohibition on transmitting unsolicited commercial email – that is. where the user must type. The name is derived from ‘shrinkwrap’. 3d 1147 (7th Cir 1997). air travel and sporting events where the purchaser pays in advance and receives the tickets with the terms included. (1998) UNSWLJ 21. . for example. The clickwrap contract has the advantage of allowing the user to read the terms and conditions before assenting. ‘Information Transactions under UCC Article 2B: The Ascendancy of Freedom of Contract in the Digital Millennium?’. In that case his Honour explicated the cost benefits to the customer where ‘telephonic recitation’ was avoided and use was made of a ‘simple approve-or-return device’. Assent occurred by clicking the appropriate button. The second uses clicks alone to indicate assent. The defendant sent spam mail with pornographic 8 See G Evans and B Fitzgerald.8 The implications have extended to mass marketing. assents to a list of terms by clicking an onscreen button marked.

com Inc. 16 356 F. (D Mass 2002). conditioned on your acceptance without modification of the terms.19 14 323 NJ Super 118 (1999). 15 See also I Lan Systems Inc. and altered the return address to make it appear that it came from a different source. The defendant claimed. would be served by permitting them to disavow particular provisions or the contracts as a whole. No. . In Steven J Caspi v Microsoft Network14 the terms of the agreement appeared in a scrollable window next to two blocks containing the words ‘I agree’ and ‘I disagree’. No. 18 In relation to the applicability to minors. and no good purpose. In Register. Section 9: 14. CLICKWRAP AND BROWSEWRAP CONTRACTS 69 materials. 10). Plaintiffs must be taken to have known that they were entering into a contract. emphasis in original. v Netscout Service Level Corp. 4th edn. .SHRINKWRAP. among other things. The user could not use Microsoft’s network without selecting the affirmative choice. The court had little difficulty in holding that the defendant was bound by the terms and conditions by clicking the button ‘I agree’ and that there was an enforceable agreement. Hotmail applied for an injunction to restrain both the spamming and the false source. Plaintiffs cannot use the infancy defense to void their contractual obligations while retaining the benefits of the contract. . consonant with the dictates of reasonable reliability in commerce. he cannot take the benefit of the contract without the burden of the conditions or stipulations’. allowing them the opportunity to maintain good standing in the classes in which they were enrolled . Thus. 2007: ‘if an infant enters into any contract subject to conditions or stipulations. 17 Company Civ Act. The appellate court held that this created an enforceable contract:15 To conclude that plaintiffs are not bound by [the forum] clause would be equivalent to holding that they were bound by no other clause either. since all provisions were identically presented. that the terms could not form part of any agreement as he had not agreed to the terms. conditions and notices contained herein. 07–0293 (ED Va 2008) at 8. They received a grade from their teachers.’ By clicking ‘I Agree’ to create a Turnitin profile and enter the Turnitin website. the court quoted from Williston on Contracts.’ Also the Clickwrap Agreement provides that iParadigms will not be liable for any damages ‘arising out of the use of this web site. 3d 393 (2nd Cir 2004). Plaintiffs accepted iParadigm’s offer and a contract was formed based on the terms of the Clickwrap Agreement. are offered to you. In AV et al. states: ‘Turnitin and its services . 07–0293 (ED Va 2008). Clickwrap agreements must expressly and unambiguously manifest assent prior to the user being given access to the product. . v Verio Inc. which appears directly above the ‘I Agree’ link. . v iParadigms LLC17 a US court applied the clickwrap principle to minor high school students:18 The Court finds that the parties entered into a valid contractual agreement when Plaintiffs clicked ‘I Agree’ to acknowledge their acceptance of the terms of the Clickwrap Agreement. plaintiffs’ infancy defense fails’ (p. The key is to determine whether or not the user had given consent to the terms and conditions by a positive and unambiguous act. the user. The court concluded: ‘Plaintiffs received benefits from entering into the agreement with iParadigms.16 the court described the key to a clickwrap agreement being that the decision to accept or reject must occur before access is given. 19 Company Civ Act. The first line of the Clickwrap Agreement.

Netscape sought to compel arbitration arguing the applicability of the online agreement. so it was through more than two centuries of jurisprudence in this country. So it was at King’s Bench in common law England. Next to this was a link which. Supp. leaving it optional to view those terms. To download the software. Specht claimed that as a result.21 Actual or presumptive knowledge of the browsewrap terms and conditions. may create a contract. so it was under the common law in the American colonies. The reasoning in Ticketmaster Corp. The only reference to the terms and conditions appeared only if the user scrolled down the page. a vendor of software to be downloaded may give the user the opportunity to browse the terms but has not made access to the product conditional on reading the available terms and conditions. The user would then see the words ‘please review and agree to the terms of the Netscape SmartDownload license agreement before downloading and using the software’. users click the button marked ‘Download’.20 Specht downloaded Netscape’s SmartDownload software. any sign.. 22 54 USPQ 2d 1344 (CD Cal 2000). Where click-wrap license agreements and the shrink-wrap agreement at issue in ProCD require users to perform an affirmative action unambiguously expressing assent before they may use the software. . The court held that Specht was not bound by the terms. in contrast. and so it is today. 21 150 F.22 was consistent with Specht’s case. v Tickets. 2d 585 (SD NY 2001). 587. For example. as long as it is unequivocally referable to the promise. but without deciding the point 20 150 F. if clicked. or even wilful inaction. that affirmative action is equivalent to an express declaration stating. opened a web page containing the terms. The fact that users were not required to give a positive assent before proceeding was critical to the court’s reasoning. which included an arbitration clause. including the arbitration clause. Supp. For example. Netscape’s SmartDownload. ‘I assent to the terms and conditions of the license agreement’ or something similar. Assent may be registered by a signature.com Inc. Netscape’s Navigator will not function without a prior clicking of a box constituting assent. private information was wrongfully and surreptitiously transmitted to Netscape. will suffice. In Specht v Netscape Communications Corp. Formality is not a requisite. The court doubted whether such browsewrap agreements were enforceable: Promises become binding when there is a meeting of the minds and consideration is exchanged. The vendor may merely place a link to the ‘terms of download’ on the download page. symbol or action. allows a user to download and use the software without taking any action that plainly manifests assent to the terms of the associated license or indicates an understanding that a contract is being formed. or a click of a computer mouse transmitted across the invisible ether of the Internet. a handshake. for example by prior access.70 LAW OF ELECTRONIC COMMERCE Browsewrap The term ‘browsewrap’ refers to the situation where a user enters into an agreement without giving unambiguous consent to the terms and conditions. 2d 585 (SD NY 2001).

. and no deep linking to the site is permitted. The court preferred a firm assent by a ‘clickthrough’ process. It cannot be said that merely putting the terms and conditions in this fashion necessarily creates a contract with anyone using the web site.23 In relation to deep linking. but included the statement: ‘These tickets are sold by another ticketing company. Many web sites make you click on ‘agree’ to the terms and conditions before going on. The website included terms and conditions purporting to govern use of the site.24 In Net2Phone Inc. This has been held to be enforceable. the link above will take you directly to the other company’s web site where you can purchase them. 23 54 USPQ 2d 1344 (CD Cal 2000). . That is not the same as this case because the ‘shrink-wrap license agreement’ is open and obvious and in fact hard to miss. Many customers instead are likely to proceed to the event page of interest rather than reading the ‘small print’. . the court added that: hyperlinking does not itself involve a violation of the Copyright Act . unjust enrichment and interference with business advantage. could create a subsequent binding contract. which include that the information is for personal use only. without confusion of source) does not necessarily involve unfair competition. .e. albeit faster and more efficiently . unfair competition.SHRINKWRAP. In defending this claim. since no copying is involved . Users were not required to confirm assent to the terms and conditions or to indicate whether or not the terms and conditions had been read. Ticketmaster makes reference to the ‘shrinkwrap license’ cases. infringement of copyright. These were located at the bottom of the website’s front page. together with knowledge of the terms and conditions. . CLICKWRAP AND BROWSEWRAP CONTRACTS 71 the court left open the possibility that prior use of a website. The plaintiff offered tickets to entertainment events for sale online. may not be used for commercial purposes. 24 54 USPQ 2d 1344 (CD Cal 2000). . the terms and conditions are set forth so that the customer needs to scroll down the home page to find and read them. There is no deception in what is happening. v Los Angeles Superior Court25 the court stated that knowledge or even presumptive knowledge of the existence of the terms may be a sufficient to form a contract. Further. The defendant sold similar tickets online but also provided information for other sites which included deep links to the plaintiff’s site. but Ticketmaster does not. .’ The plaintiffs sued for breached the contract. Although we can’t sell them to you. This is analogous to using a library’s card index to get reference to particular items. deep linking by itself (i. These deep links bypassed the plaintiff’s front page. 25 109 Cal App 4th 583 (Cal Ct App 2003). where the packing on the outside of the CD stated that opening the package constitutes adherence to the license agreement (restricting republication) contained therein. The court left open the possibility that use of a website together with knowledge of the terms and conditions could create a binding contract. the customer is automatically transferred to the particular genuine web page of the original author. but stated: [The terms and conditions provide] that anyone going beyond the home page agrees to the terms and conditions set forth.

26 In Register. 27 356 F. (2007) 35 Australian Business Law Review 152. to contact the computer of the supplier and place an order for replacement stock. or to enact specific legislation to protect electronic contracts. without human intervention. selected parts of the Fair Trading Acts. internationally the courts have provided an adequate response in the past decade and there is no reason to assume that Antipodean courts will not respond in the same way. it has not fundamentally changed the principles of contract. 403. 26 See also Comb v PayPal Inc. without human intervention. legislation which protects consumers generally applies equally to electronic contracts. In the absence of cases in Australia and New Zealand some attempts have been made to consider the application of the unconscionability provisions of the Trade Practices Act 1974 (Cth). 2d 1165 (ND Cal 2002). v Verio Inc.28 The approach in Australia and New Zealand is yet to be firmly determined. in today’s supermarket the computer updates its inventory as items are scanned for sale. though the US cases are a good guide. accepts the order and the next morning automatically prints out worksheets and delivery sheets for the supply and transport staff. When the stock of an item falls to a predetermined level the computer is programmed. ‘Unfair terms in “clickwrap” and other electronic contracts’. At the very least. and the offeree makes a decision to take the benefit with knowledge of the terms of the offer. the Contracts Review Act 1980 (NSW).27 the court recognised that contract offers on the internet often required the offeree to click on an ‘I agree’ icon. which accordingly become binding on the offeree. Electronic agents It is possible for computer users to instruct the computer to carry out transactions automatically.com Inc. 28 356 F. However. Supp. The approach will most likely be to use or modify dicta such as Lord Denning’s ‘red hand’ passage in Thornton v Shoe Lane Parking Station Ltd. The supplier’s computer. . It is standard contract doctrine that when a benefit is offered subject to stated conditions. the court stated that this was not necessary ‘in all circumstances’: While new commerce on the Internet has exposed courts to many new situations. For example. the taking constitutes an acceptance of the terms.72 LAW OF ELECTRONIC COMMERCE but noted that cases involving cruise tickets and parking tickets have established that such assent is not necessary for formation. 3d 393 (2d Cir NY 2004). where the clause did not exempt the defendants from liability as they had not taken reasonable steps to bring it to the attention of Thornton. 218 F. 3d 393 (2d Cir NY 2004). 29 See D Clapperton and S Corones.29 However.

The computer is a tool programmed by or with a person’s authority to implement their intention to make or accept contractual offers. open source and copyright’. (2003) 10 E-Law Journal 4. (2007) 35 Australian Business Law Review 152. (2003) 23 Proctor 9. The legal status of electronic agents has not been clarified by the courts. ‘Shrinkwrap. CLICKWRAP AND BROWSEWRAP CONTRACTS 73 These electronic agents are programmed by and with the authority of the buyer and supplier. the owner accepts responsibility. . ‘Unfair terms in “clickwrap” and other electronic contracts’.30 Further reading Dale M Clapperton and Stephen G Corones. ‘The open source alternative: Shrink-wrap. but the most common view is that like any other piece of equipment under the control of the owner. 41. 30 For an example of a legislative provision see Uniform Electronic Transactions Act (US) s14.SHRINKWRAP. Debora Halbert. Alan Davidson. clickwrap and browsewrap contracts’.

the signor may not be not bound because he or she lacked the requisite intention – there could be duress. unconscionability or some other vitiating factor. An incapacitated person such as a quadriplegic may use 74 . non est factum.5 Electronic signatures The signature has been the prime method a person uses as a proof of identity. A signature on a document indicates the provenance of the document and the intention of the signatory with regard to that document. Traditional signatures Understanding an electronic signature involves understanding the purpose and use of the traditional signature. The underlying intention of the signatory may be to be bound only by the subsequent act of delivery. The signature of an illiterate may be an ‘X’. This chapter examines the regulation. The law has developed for centuries with notions of deeds and documents being signed. witnessed. In some situations a signatory is bound on signing. Their intention is paramount. with no legal interest in the terms. There may be many signatures on a contract: one person may sign intending to be bound by the terms of the contract. and in others the signatory is not bound until there is an affirming act. The status of traditional signatures has been taken for granted or assumed. sealed and delivered. being used in electronic commerce. such as digital signatures and SSL technology. a form of signature is adopted for electronic documents. notarised and so forth. while another is merely a witness. With the advent of the electronic era. and as a material expression of intent and execution of documents. use and security of electronic signatures and the types of electronic signatures. Even if a signature appears on a document. undue influence.

. Wyndham. 5 (1794) 1 Esp N P C 190. Here it is true. 9 (1844) 5 QB 574. The essential element of intention was rising to the fore. 114 ER 1366. and sealing is a sufficient mark that this is his will’. 546. 83 ER 545. 114 ER 1366.10 the defendant prepared a document which showed the plaintiff’s address at the top. with the defendant’s address.6 The case of Lobb v Stanley7 in 1844 considered the effect of a signature in the body of writing. that is enough. for the purpose of authenticating it. but only ‘Mr Stanley’. Charlton and Levinz JJ. 581. approval or execution of the contents of the document is paramount. The cases assist in determining the characteristics of a signature. in the body or at the end. These cases regarded the writing of one’s name within the document to be equivalent to a signature. as ‘sufficient signing’. the case of Tourret v Cripps11 in 1879 dealt with the proposed terms of a lease in the defendant’s own handwriting on a sheet of paper on which was printed at the head of the page ‘From Richd L. 6 For the text of Statute of Frauds s4 and its implications see Chapter 3. 10 [1892] 1 QB 593. 1369. either at the beginning or in the body of the document. 4 (1754) 1 Ves Jun 11 at 12. 2 (1682) 3 Lev 1. 1369. 30 ER 205. stating. Cave J stressed the importance of the ‘intention for a signature’ whether the purported signature is at the beginning. and so it carries on the face of it a guarantee that the person who signs has given his personal attention to the document’: Goodman v J Eban Ltd [1954] 1 QB 550 at 561. In 1794 in Knight v Crockford. 12 (1867) LR 2 HL 127.9 In 1892 in Evans v Hoare. 546. see Cave J at 597. and no other signature is wanted’. Cripps’. However. 7 (1844) 5 QB 574. the whole name is not written. 11 (1879) 48 LJ Ch 567. 114 ER 1366.1 the full court regarded a will. As late as 1954 Denning LJ. Lord Denman CJ stated: it is a signature of a party when he authenticates the instrument by writing his own name in the body. 170 ER 324. handwritten by the testator. See also Schneider v Norris (1814) 2 M & S 286. The court held that the document had been signed. ‘for signum is no more than a mark. and the defendant’s name and address in the body. stated that ‘the virtue of a signature lies in the fact that no two persons write exactly alike. 1 per North. In Caton v Caton12 in 1867 Lord Westbury said that what is alleged to constitute the signature must: 1 (1682) 3 Lev 1. agree to sell’ was held to be sufficiently signed under s4 of the Statute of Frauds. The inclusion of a mark in some form intended as the signatory’s authorisation. 27 WR 706. in a dissenting judgment. In all circumstances it is the underlying intention of the signatory that is determinative. I think more is not necessary.8 Wightman J stated ‘if a party insert (sic) his name. emphasis in original. 83 ER 545.3 In 1745 in Ellis v Smith4 the court held that ‘signing’ for legal purposes means the affixing of a personal signature. with his name appearing in the will. 3 83 ER 545. 8 (1844) 5 QB 574.ELECTRONIC SIGNATURES 75 another person to place the signature on the document. In 1682 in Lemayne v Stanley. 583.2 The majority also held that the testator’s seal was a sufficient signing.5 a letter beginning ‘I James Crockford.

419 (1938). and that the signature was intended to have that effect. 324. 199 SE 416. or that such signature has been recognised and brought home to him as having been done by his authority so as to appropriate it to the particular instrument. Higginbotham J stated: A signature is only a mark. such as an impress stamp bearing a facsimile of the person’s signature. in order to be bound. Ex Parte Myers13 in 1884 dealt with a pawnbroker’s pledge ticket that was not signed in accordance with the relevant legislation but was signed by an authorised agent. . without anything to verify it. It has been held in this court that a private person can sign a 13 (1884) 10 VLR 322. See also Smith v Greenville County 188 SC 349. The name of the pawnbroker was printed on the ticket.’ 16 [1956] 1 All ER 341. the case holds that a person. as opposed to simply providing an autograph. . . There was nothing to indicate who affixed the rubber stamp. R v Moore determines that the object of a signature affixed to a document is to authenticate the genuineness of the document.76 LAW OF ELECTRONIC COMMERCE be so placed as to show that it was intended to relate and refer to.15 Further. printed. .’ 15 Higginbotham J added. must put his or her mind to the act of signing the document. but the only signature on these documents (if such it can be called) was a rubber stamp ‘Lazarus Estates Ltd’. stamped. It must shew that every part of the instrument emanates from the individual so signing. There was no signature of a secretary or of any person at all on behalf of the company. . The case of R v Moore. ‘It was observed by Patterson J in Lobb v Stanley.16 Denning LJ (as he then was) made the following comment in relation to a company stamp: The statutory forms require the documents to be ‘signed’ by the landlord. and a signature lithographed on an instrument by a party is sufficient for the purpose of signing it: it being immaterial by what kind of instrument a signature is made. but can be achieved by an agent or through the use of some mechanical means. the printed name of the party who is required to sign the document is enough . or having relation and reference only to a portion of the instrument. engraved. It follows that if a signature be found in an instrument incidentally only. where the Statute does not require that the signature shall be an autograph. . It must govern every part of the instrument. and where the Statute merely requires a document shall be signed. . the signature cannot have legal effect and force which it must have in order to comply with the statute. typewritten. .14 Binding oneself to the contents of the document therefore does not require the physical act of putting pen to paper. that the object of all Statutes which require a particular document to be signed by a particular person is to authenticate the genuineness of the document. the Statue is satisfied by proof of the making of the mark upon the document by or by the authority of the signatory . In Lazarus Estates Ltd v Beasley. where it was held: ‘A signature may be written by hand. 14 (1884) 10 VLR 322. . photographed or cut from one instrument and attached to another. and that in fact it does relate and refer to. every part of the instrument . and to give authenticity to the whole of the memorandum. proof in these cases must be given that the name printed on the stamp was affixed by the person signing. or the signature may be impressed upon the document by a stamp engraved with a facsimile of the ordinary signature of the person signing .

17 the Californian District Court commented that it ‘must take a realistic view of modern business practices’. Similarly. Modern signatures In the United States in 1948. His Honour stated that such an electronic document could be authenticated by looking at other factors. but it has not been held that a company can sign by its printed name affixed with a rubber stamp. 19 In the United States. ‘The verdict on plaintext signatures: They’re legal’. (1994) 10 The Computer Law and Security Report 311–12. 17 79 F. 117 (DC Cal 1948). suggesting that the court should take judicial notice of the extensive use of the teletype machine. . ‘Authenticating electronic mail messages – some evidential problems. 20 (1844) 5 QB 574.22 Williams J recognised that modern communication.html. see B Wright. the court held teletype messages satisfy the Statute of Frauds in California. including the sender’s name in the body of the email as envisaged in Lobb v Stanley20 and Evans v Hoare21 will suffice. may not bear a personal signature. . 114 ER 1366. Supp.18 However. ‘The receipt of evidence by Queensland courts: Electronic records’. the identifiers indicate the machine used. Thus signing an electronic communication such as an email by simply typing the sender’s name at the end would be an acceptable electronic signature if inserted with the requisite intention. in R v Frolchenko. www. In holding that the point was res nova.ELECTRONIC SIGNATURES 77 document by impressing a rubber stamp with his own facsimile signature on it . . 21 [1892] 1 QB 593. 22 (1998) QCA 43.au/wp52. These possibilities may weigh heavily against any suggestion that a telex or facsimile should be treated as signed. not necessarily the particular user or author of the message. Cases requiring a mark with a corresponding intent of authorising or executing the document have equal application to electronic documents with electronic signatures.qld.qlrc. In relation to facsimiles and telexes it could be argued that each message contains identifying information which could be regarded as a signature in law. Office facsimiles may be used by many parties. such as email. such as whether the name appears in typescript at the end of the document. in Joseph Denunzio Fruit Company v Crane. 18 See C Reed. some commentators have adopted a pragmatic attitude to the potential difficulties raised by authentication.19 Electronic signing Electronic documents may be signed electronically with the same underlying intent and purpose as traditional documents.gov. In the Queensland Court of Appeal. see Cave J at 597. (1989) 52 Modern Law Review 649 and Queensland Law Reform Commission Issues Paper. It is possible to alter the telex machine or facsimile machine so that it sends a false identification message.

. . ‘it is not possible to hold that the automatic insertion of an email address is . [2006] EWHC 813. but was described in the header of the email as having come from Nelmehta@aol. the issue before the court was whether the automatic insertion of a person’s email address after the document has been transmitted constitutes a signature for the purposes of the Statute of Frauds. and with the intention of giving.78 LAW OF ELECTRONIC COMMERCE In Mehta v J Pereira Fernandes SA. and that the header was ‘divorced from the main body of the text of the message’.23 the court considered an email which was not signed at the foot of the message. para 26. and possibly by using a pseudonym or a combination of letters and numbers (as can happen for example with a Lloyds slip scratch). and stressed the importance of the signatory’s intention in placing of inserting the purported signature. The court cited Evans v Hoare with approval and determined that whether or not an email address in the header amounts to a signature depends upon the intention of the sender.24 In determining what would amount to a signature Judge Pelling QC examined the underlying purpose. The Statute of Frauds requires such guarantees to be in writing.com. [2006] EWHC 813.25 In relation to an electronic document his Honour commented that: if a party creates and sends an electronically created document then he will be treated as having signed it to the same extent that he would in law be treated as having signed a hard copy of the same document. . If there is no further evidence in relation to the maker’s intention. His Honour’s conclusion was that an email address insertion was ‘incidental’. (1867) LR 2 HL 127. The purpose of the Statute of Frauds: is to protect people from being held liable on informal communications because they may be made without sufficient consideration or expressed ambiguously or because such a communication might be fraudulently alleged against the party to be charged. para 16. Judge Pelling QC held that the email would be a note or memorandum to which section 4 of the Statute of Frauds applied. stating: a party can sign a document for the purposes of Section 4 by using his full name or his last name prefixed by some or all of his initials or using his initials. Judge Pelling QC relied on the passage from Lord Westbury in Caton v Caton27 quoted earlier. However. para 28. [2006] EWHC 813. stating: 23 24 25 26 27 [2006] EWHC 813. in his Honour’s view. his Honour considered whether it was sufficiently signed.26 However. providing always that whatever was used was inserted into the document in order to give. by the email. intended for a signature’. authenticity to it. undermine or potentially undermine the purpose of the Statute of Frauds. offered to provide a personal guarantee in favour of the plaintiff in relation to a payment of £5000. To conclude otherwise would. The fact that the document is created electronically as opposed to as a hard copy can make no difference. The defendant. on certain terms.

para 29.29 Agnes J held that a police report made ‘by means of email or some other electronic method’ is regarded as signed. An email can be made to appear to be from a third party and false addresses and pseudonyms can be employed. . ● to clarify and identify the personal involvement of the signatory in the act of signing. telexes and so forth have also been faked. three signatures typically appear on a testamentary disposition such as a will. However. facsimiles. The genuineness of a document does not rely solely on the signature. Parties to contracts generally accept signatures at face value.us/itd/legal/case. Similarly. Functions include: ● to identify the signatory. Commercial parties have accepted this risk in the past.ELECTRONIC SIGNATURES 79 ‘it is not possible to hold that the automatic insertion of an email address is. there is no technical proof of origin of a telegram or telex. 97CV0050 (Mass 1997). this is not new. accepting the associated practical and legal risks. Functions of signatures The functions of a signature of a person historically do much more than merely authenticate the genuineness of a document. subjecting the reporting officer to possible perjury charges. More often the origin and genuineness are determined from the facts.htm. particularly in like circumstances. For example. The intention and function depend on whether the signature is that of the testator or witness. Letters. and there is typically no practice requiring additional verification until a dispute arises. principle or law that an electronic signature is not valid merely because of the possibility of fraud or tampering. They have no technical process to prove the genuineness of a signature. It is quite rare that standard hardcopy documents are adduced into evidence and proven as genuine only by the signature. Acceptance at face value and risk Parties to traditional hardcopy documents had accepted signatures at face value. 29 No. “intended for a signature” ’. The courts and legislators should resist establishing any rule. 28 (1867) LR 2 HL 127.ma. to use Cave J’s language. www.state. conduct and acts of the parties and the surrounding circumstances of the case. or that such signatures are fallible. handwritten or otherwise. Typically a range of proofs are used for verification purposes. Fraudsters utilise all means at their disposal. Lawmakers should recognise the commercial parties’ acceptance of risk for commercial expediency.28 In the US case Doherty v Registry of Motor Vehicles.

● reliance – the signature requirement may indicate that the veracity of document or record may be relied on by others later. P Little and W Caelli. Tas – s7(1). Vic – s9(1). The Commonwealth has substantially similar provisions in s10(1). to meet the requirements under law of signatures.7. W Caelli and P Little. (1998).30 In the absence of vitiating factors such as fraud. undue influence and unconscionable conduct. the signature of a person is required. ● channelling – to act as a demarcation between ‘intent to act in a legally significant way and intent to act otherwise’. The signature provision states:33 If. non est factum. The underlying rationale is based on functional equivalence.32 Electronic Transactions Acts The requirement for signature in documents.31 There appear to be five main functions of signature requirements: ● evidentiary – to ensure the availability of admissible and reliable evidence when applying legislation such as the Statute of Frauds. Where the law requires a signature. particularly those that document. to approve the contents of the document. SA – s8(1).80 ● ● ● ● LAW OF ELECTRONIC COMMERCE to associate a particular person with the contents of the document. to witness another person’s signature. moneylaundering and statutes of limitation. 31 L’Estrange v Graucob [1934] 2 KB 394. ‘Signature stripping: A digital dilemma’. Where the electronic signature is functionally equivalent to the traditional signature. the law regards a signature as binding on the signatory in relation to the contents of the document even if the signatory has not read the document. on certain conditions. that requirement is taken to have been met in relation to an electronic communication if: 30 See A McCullagh. 32 See Electronic Commerce Expert Group. Each of the nine Australian Electronic Transactions Acts includes a provision deeming electronic signatures. under a law of this jurisdiction. evidence or create contracts. ACT – s9(1) and NT – s9(1). para 2. 33 NSW – s9(1). to indicate authorship of the document by the signatory. it ought to be treated equally in law. [2001] JILT (1). Report of the Electronic Commerce Expert Group to the Attorney-General’. [1998] UNSWLJ 56 and A McCullagh.28. but also makes special provision for Commonwealth entities. ● cautionary – to act as a warning that this is a serious document with legal consequences. ‘Electronic signatures: Understand the past to develop the future. and ● record-keeping – for compliance with laws such as taxation. was discussed in Chapter 3. ‘Electronic commerce: Building the legal framework. Qld – s14. WA – s9(1). the Electronic Transactions Acts deem that the requirement is taken to have been met in relation to an electronic communication where certain conditions are met. .

● the range of authentication procedures made available by the intermediary. . the provision will require the court. ‘requirement is taken to have been met’. . ‘of the information communicated’.34 The requirement that the court must have ‘regard to all the relevant circumstances at the time the method was used. It is intended to create a standard for functional equivalence. ‘electronic communication’. the method was as reliable as was appropriate for the purposes for which the information was communicated’. www.org. and ● any other relevant factor. 35 See UNCITRAL Guide to the Model Law of Electronic Commerce. ‘a method used to identify the person and to indicate the person’s approval’. ● existence of insurance coverage mechanisms against unauthorised messages. ‘the method must be as reliable as appropriate for the purposes for which the information was communicated’ – ‘having regard to all the relevant circumstances at the time the signature method was used’ and ‘consent’. ‘signature of the person . ● the nature of their trade activity. These might include. in particular para 58. to cover a significant number of factors – legal. is a serious weakness of the signature provision. ● the importance and value of the information contained in the data message. ● the function of signature requirements in a given statutory and regulatory environment. the method was as reliable as was appropriate for the purposes for which the information was communicated. ● the availability of alternative methods of authentication and the cost of implementing them. and (c) the person to whom the signature is required to be given consents to that requirement being met by way of the use of the method mentioned in paragraph (a).uncitral. ● the kind and size of the transaction. through counsel. ● the degree of acceptance or non-acceptance of the method of identification in the relevant industry or field both at the time the method was agreed upon and the time when the data message was communicated. ● the frequency with which commercial transactions take place between the parties. in relation to an electronic communication’. ‘method used’. for example: ● the sophistication of the equipment used by each of the parties.ELECTRONIC SIGNATURES 81 (a) a method is used to identify the person and to indicate the person’s approval of the information communicated. and (b) having regard to all the relevant circumstances at the time the method was used. . technical and commercial – before making the equivalence determination.35 34 The following expressions and phrases from the legislation were considered in detail in Chapter 3: ‘signature of person’. ● compliance with authentication procedures set forth by intermediaries. However. ● the capability of communication systems. ● compliance with trade customs and practice. reliability of the method used’. paras 52–61.

or (b) a communication of information in the form of sound by means of guided or unguided electromagnetic energy.82 LAW OF ELECTRONIC COMMERCE ‘Electronic signature’ defined An ‘electronic signature’ is any means of electronic authentication of the identity of a person and of the intent of that person to indicate approval or to be associated with an electronic record. but this point remains untested. Tas – s3. 37 Art. or both. including any letters. . 2. attached to or logically associated with an electronic record. They do not need to. affixed to or logically associated with. which may be used to identify the signatory in relation to the data message and to indicate the signatory’s approval of the information contained in the data message. WA – s5. Vic – s3. where the sound is processed at its destination by an automated voice recognition system. text or images by means of guided or unguided electromagnetic energy. The Commonwealth Electronic Transactions Act 1999 uses the narrower word ‘speech’ in place of ‘sound’. Instead. means a method used to identify a person and to indicate that person’s approval of that information’.’ This savings provision is designed to ensure that the general deeming provision of the Electronic Transactions Acts does not affect the operation of a specific law which may call for an electronic signature ‘howsoever described’. By necessity. New Zealand defines ‘electronic communications’ in s5: ‘ “electronic communication” means a communication by electronic means’. The Singapore Act defines ‘electronic signature’ as: 36 NSW – s5. characters. they logically connect the use of a ‘signature’ with an ‘electronic communication’. The Electronic Transactions Acts in Australia do not define ‘electronic signature’. the UNCITRAL Model Law of Electronic Signatures defines an ‘electronic signature’: ‘Electronic signature’ means data in electronic form in. used with the intention of authenticating or approving the electronic record. However. SA – s5.37 The New Zealand Electronic Transactions Act 2002 provides: ‘ “electronic signature”. The UNCITRAL Model Law of Electronic Commerce does not use the expression ‘electronic signature’. a data message. numbers or other symbols. In all likelihood a court would apply the expression to all forms. An ‘electronic signature’ may be defined as any electronic data. such a signature must be electronic. The Singapore Electronic Transactions Act 1998 includes extensive provisions dealing with electronic and digital signatures. in relation to information in electronic form. ACT – s5. and then only to provide that ‘Certain other laws [are] not affected.36 The expression ‘electronic communication’ may be regarded as narrower than ‘electronic record’ or ‘electronic document’. The term has no universally accepted meaning and internationally is variously defined in different statutes. Qld – s6. The expression only appears once in each of the Australian Acts. or both. and NT – s5. The expression ‘electronic communication’ is defined as: (a) a communication of information in the form of data.

ELECTRONIC SIGNATURES 83 any letters. while valid in the right circumstances. Nevertheless the traditional signature is used extensively in commerce. Security of electronic signature Traditional signatures can be easily forged. The number may be dynamic. It would be difficult for a third party to work out the authenticating 38 Electronic Transactions Act 1998 (Singapore) s2. Two parties could agree upon a simple code. is most insecure. Parties could agree upon a simple number or a string of characters. This number may be placed at the end of the message with the agreed meaning that this verified that the communication came from the other party. and executed or adopted with the intention of authenticating or approving the electronic record. there are many choices available to parties. for example the agreed number could be the sum of five times the date plus six times the month: 5 November would thus be ‘91’. certain types of electronic signatures have a much higher level of security than the traditional signature. to raise the level of authentication and verification to well in excess of that of a handwritten signature. on contracts. Such a simple signature identifies the signor by agreement. cheques and other negotiable instruments. Electronic signatures have different risks.38 An electronic signature may be as simple as typing a name at the end of an email. characters. with the same intention and for the same purpose as a traditional signature on a paper record or document. and may be used for authentication and verification purposes with a greater degree of certainty. For example. parties agree on the number ‘333’. While the simple electronic signature merely typed at the end of an electronic record may be less secure than the traditional signature. Parties entering into transactions over the internet frequently need to authenticate the message and verify the identity of the sender. and indicates authentication or approval. depending upon factors such as the commercial and legal risk involved. Such a signature. commercial and otherwise. Uses An electronic signature may be used to sign any electronic document or record. The level of security to be used is a matter for the parties. numbers or other symbols in digital form attached to or logically associated with an electronic record. Both forms of signatures have data in digital form attached to or logically associated with an electronic document. However. . It may be a complex mathematical transformation designed to provide a level of security to ensure that the electronic message is from the purported sender and is unaltered. Anyone could type a person’s name at the end of a typed electronic communication.

Although often used as a signature in the usual sense. scanned into a computer and then placed electronically into an electronic document. computer file or web page. The recipient verifies the digital signature by a simple automatic computation involving the data. Digital signatures The digital signature is a subset of the electronic signature. such as determining the bona fides of the message. as anyone intercepting such an email can extract it and use it. See also the UNCITRAL Model Law of Electronic Signatures. and if placed with the requisite intention operates in the same manner as any other electronic signature. The recipient should then take appropriate steps. the purported digital signature and the sender’s public key. The computation determines whether or not the correct mathematical relational exists. such as an email. Digitised signatures A digitised signature is a handwritten signature. it reports that the digital signature is verified. It may be better described as a ‘digital certificate’. Anyone who overhears or intercepts the key 39 Electronic Transactions Act 1998 (Singapore) s2. A digitised signature has a low level of security. and seek a retransmission. such as an email. Such a signature is an electronic signature. and (b) whether the initial electronic record has been altered since the transformation was made. the expression ‘digital signature’ is a misnomer. This method is symmetrical: the process to decrypt is the reverse of the process to encrypt. If it does. There are more sophisticated methods available commercially. Standard encryption requires that the sender and the recipient of a message know and use the same secret code. A digital signature is: an electronic signature consisting of a transformation of an electronic record using an asymmetric cryptosystem and a hash function such that a person having the initial untransformed electronic record and the signer’s public key can accurately determine — (a) whether the transformation was created using the private key that corresponds to the signer’s public key.84 LAW OF ELECTRONIC COMMERCE signature even by intercepting a handful of communications. to give the appearance of a traditional signature.39 A digital signature permits both verification and authentication of data. An unverified digital signature may be an indication that there is a hoax sender or that the message has been altered. as it functions as certification of the document and sender (or creator) rather than as a formal signature. Digital signatures are attached to specific data. . The major difficulty with it is agreeing on the secret code with confidence that no one else finds out. The method is called private encryption.

The program makes complex mathematical calculations to do this. All communications involve only the public key. or (c) the message’s destination or the identity of the person to whom the message was addressed.ELECTRONIC SIGNATURES 85 can potentially read all encrypted messages. The courts should accept such an authentication. but the private key cannot be determined from the public key. or (b) the date on which or the time at which the message was sent. there is no similar presumption regarding email. set (the ‘hash result’) such that: a record yields the same hash result every time the algorithm is executed using the same record as input. Any person holding the corresponding public key is able to verify that the message has not been altered and authenticate that it could only come from the holder of the private key. private encryption has its own inherent security risks. There is a mathematical relationship between the public key and the private key. The ‘hash function’ means applying an algorithm mapping or translating one sequence of the electronic record into another. and it is computationally infeasible that two records can be found that produce the same hash result using the algorithm.40 40 Evidence Act 1995 (Cth) s71 and Evidence Act 1995 (NSW) s71. Authentication of electronic data messages will become increasingly important for lawyers and commercial parties for evidentiary purposes. it is computationally infeasible that a record can be derived or reconstituted from the hash result produced by the algorithm. There is no need for both parties to share information about the private key. lettergram or telex so far as the representation is a representation as to: (a) the identity of the person from whom or on whose behalf the message was sent. One or more public keys may be created from the private key. no private key is ever transmitted or shared. Accordingly. However. and thus of when one may need this level of encryption. The level of security available is such that it is regarded as impossible to duplicate. A verified result of a digital signature is regarded as certain in the industry so far as the computing aspects are concerned. the Commonwealth and NSW Evidence Acts state: The hearsay rule does not apply to a representation contained in a document recording a message that has been transmitted by electronic mail or by a fax. Public encryption was developed in 1976 to resolve private encryption dilemmas. The holder of a private key uses that key to place a digital signature on the relevant electronic document. The private key is kept secret. lettergrams and telegrams. Each person’s public key is freely available to anyone. . Nonetheless. in modern communications one may have little notice of who one’s correspondent may be. telexes. telegram. Some state Acts make presumptions regarding the sending and receipt of postal articles. The sender and recipient each possess a pair of keys: the public key and the private key. The Australian Evidence Acts do not address all aspects of email communications. Also. generally smaller.

Legislation should deal simply with the legal effect of electronic signatures.pdf. 41 The text of the UNCITRAL Model Law on Electronic Signatures was adopted on 5 July 2001. the federal government developed the Australian Business Number Digital Signature Certificate (ABN-DSC). While the Commonwealth Electronic Transactions Act 1999 is based on the UNCITRAL Model Law of Electronic Commerce.uncitral.pdf. Since March 2001 Commonwealth agencies have accepted the certificates to identify businesses for online transactions. such as the levels of security and reliability required for electronic signatures. 42 Directive 1999/93/Ec of the European Parliament and of the Council of 13 December 1999. It is available at www. Only recently have international models been available for national legislatures. In July 2001 UNCITRAL released the Model Law of Electronic Signatures. The debate in relation to the legal issues raised by electronic commerce is often clouded by the discussion of digital and electronic signatures. it is more appropriate for the market to determine practice issues. It establishes the presumption that electronic signatures are to be treated as equivalent to handwritten signatures where certain criteria of technical reliability are met. ‘Electronic signature’ is a term used to refer to a range of technologies intended to ensure the security and certainty of electronic commerce. Australian Business Number Digital Signature Certificates To aid electronic commerce. available at www. In a similar vein. the relying party and trusted third parties that might intervene in the signature process. Given the pace of technological development.42 It establishes a legal framework for electronic signatures and certain certification services. It facilitates online service delivery and is intended to foster the use of digital certificates and electronic commerce in Australia. the federal Attorney-General’s view is that a legislative regime concerning digital and electronic signatures is not required. which is a digital certificate linked to an entity’s ABN. . on a Community Framework for Eelectronic Signatures.int/comm/internal_market/ en/media/sign/Dir99–93-ecEN. Australia has not enacted any legislation based on this Model Law.eu. courts will need to be satisfied regarding the authenticity of transmissions.europa. the European Union passed a Directive on a Community Framework for Electronic Signatures.org/english/texts/electcom/ml-elecsig-e.41 This Model Law is intended to bring greater legal certainty to the use of electronic signatures.86 LAW OF ELECTRONIC COMMERCE Nevertheless. Only Certification Authorities accredited under the Commonwealth’s Gatekeeper Public Key Infrastructure framework are able to issue ABN-DSCs. The Model Law uses technology-neutral language and establishes rules of conduct for assessing responsibilities and liabilities of the signatory. The enactment of legislation dealing with digital and electronic signatures needs to be considered with caution.

43 Secure Socket Layer – Transport Layer Security Secure socket level (SSL) technology refers to a sequence of processes that ensure that information stored in electronic form or transmitted over networks. For an example of an SSL application. Other key data is calculated from the ‘master secret’. TLS ensures that no third party may interfere with or read any message. In March 2002. The protocols allow server applications to communicate in a way designed to prevent eavesdropping. communications would be regarded as secure.optimati. is not accessible to any person not authorised to view that information. Client and server negotiate a common secret called ‘master secret’. TLS is the successor to SSL. The SSL and TLS protocols exchange records. mutual authentication requires deploying public key infrastructure to clients. the record level encapsulates another protocol. 44 ALRC. When the connection is initiated. Each record has a content type field that specifies the type of protocol being used.44 Transport Layer Security (TLS) is a security protocol that ensures privacy between communicating applications and their users on the internet. This allows users to securely provide personal details – such as name. . the federal government established the Online Council following agreement by states.ELECTRONIC SIGNATURES 87 In 1997. which is passed through a ‘Pseudo Random Function’. authenticated and verified. tampering and message forgery.agimo. SSL and TLS provide endpoint authentication and communications privacy over the internet using cryptography. the server is authenticated and the client remains unauthenticated.5. Discussion Paper 72.au/archive/publications_noie/2003/08/framework/glossary. the handshake protocol.php?option=com_content&task=view&id=47&Itemid=63. encrypted and packed with a message authentication code. For evidentiary purposes. confidentiality. 43 See generally the website of the Australian Government Information Management Office: www. When a server and client communicate.gov. Both SSL and TLS use a form of digital signature technology. para 6. address and credit card numbers – to sites employing the protocol.com/index. Each record can be compressed. territories and local government to cooperate on online issues. In typical use. This will help meet the e-commerce objectives of governments by making digital certificates widely available to businesses. see SSL-Explorer Enterprise Edition at www. integrity and non-repudiation. such as the internet. all states and territories agreed to urgently consider accredited and cross-recognised certificates which are ABN-DSC compliant. This development has direct implications for B2G (business to government) electronic commerce and facilitates B2B (business to business) electronic commerce by providing authentication.

(2002) MurUEJL 29. (2004) 24 Proctor 7. (2003) MurUEJL 44. W Caelli and P Little. which is the most common protocol used on the World Wide Web. 31. (2002) 22 Proctor 8. the protocol becomes HTTPS. 29. ‘Electronic signatures’. Further reading Sharon Christensen. Alan Davidson. ‘Digital signature. ‘Signature stripping: A digital dilemma’. . A McCullagh. Yee Fen Lim. ‘Signatures on electronic documents’. Alan Davidson. When used. certification authorities and the law’. (2001) JILT (1). It uses public key certificates to verify the identity of endpoints. William Duncan and Rouhshi Low. ‘The Statute of Frauds in the digital age – maintaining the integrity of signatures’.88 LAW OF ELECTRONIC COMMERCE Applications The SSL and TLS protocols are commonly found with hypertext transfer protocol (HTTP). HTTPS is used to secure World Wide Web pages for applications such as electronic commerce.

designs and innovation. medicines. patents and circuit layouts. research. for example. This chapter explores these issues and developments and the contiguity between copyright and electronic commerce. writers. aural and graphic – has posed new questions and resulted in the creation of new rights internationally.6 Copyright issues in electronic commerce The internet facilitates the swift copying and exchange of digital material. other than a brief overview. Hyperlinking and framing can result in new and novel possibilities for infringement of copyright. literary and musical works. It is not intended to state the law relating to copyright. 89 . Their works. composers and designers have the incentive of potential rewards for their efforts. can be easily transferred in peer-to-peer dealings. The state gains the benefit of. The advent of electronic commerce and the internet have necessitated a rethink of intellectual property issues by the World Intellectual Property Organisation (WIPO). patents and designs will form part of the public domain when the predetermined period expires. The next chapter addresses the interplay between electronic commerce and intellectual property rights in trade marks. Such transfers have become the target of copyright owners. such as music and videos. Inventors. the courts and the legislature. The proliferation of material on the internet – written. The nature of copyright Intellectual property comprises state-sanctioned rights entitling the holder of such rights to a limited monopoly on exploiting and controlling the property for a predetermined period of time. new inventions. Works protected by copyright.

It protects the expression of an idea. the Copyright Act 1968 (Cth). they both have copyright protection. Works must be original. Telstra Corp. patents of inventions and designs.2 Originality is assessed only according to whether or not the creator produced the work using his or her own skill and effort and did not copy another’s work. The 2002 World Intellectual Property Organisation (WIPO) Copyright Treaty enacted greater restrictions on the use of technology to copy works in the nations that ratified it. 4 See APRA v Canterbury-Bankstown League Club Ltd [1964] NSWR 138. 2 See Macmillan v Cooper (1923) 93 LJPC 113. s51(xviii) Copyrights. Secondary copyright refers to ‘subject matter other than works’.90 LAW OF ELECTRONIC COMMERCE Copyright arose only after the invention of the printing press. giving the Berne Convention near global application. See also Lott v JBW & Friends PL [2000] SASC 3. Supp. That is. 610.4 Copyright covers two categories of material: original and secondary. Feist Publications Inc.3 The right usually vests in the creator or author of a work at the time when the work is first produced in material form. as defined by the Copyright Act. but not the idea itself. The regulations of the Berne Convention are incorporated into the World Trade Organization’s TRIPS agreement (1995). For example if one is said to own the copyright in a musical work. choreography and software. cinematograph films (this covers computer-generated or interactive computer games). television and sound broadcasts and published editions of works. From copyright’s initial application to books and maps it has now extended to such things as sound. Long title: ‘An Act for the Encouragement of Learning. painted or drawn. the Statute of Anne in 17021 is regarded as the first copyright legislation. Copyright. no other person has the right to make a copy of that work without permission. It gave publishers rights for fixed periods. and trade marks. Ltd v APRA (1997) 38 IPR 294. such as sound recordings. 622 (Kan 1990). may be literary. filmed or taped. Copyright is intended to reward authors economically by giving them control of the use of their work. The Berne Convention pioneered the concept that copyright automatically arose at the time of creation. Previously copies were made by hand and were relatively expensive and time consuming. by vesting the Copies of Printed Books in the Authors or purchasers of such Copies. The Berne Convention of 1886 established international recognition of copyright among member nations. If two authors express the same idea and their respective works are created independently. Cramp & Sons Ltd v Frank Smythson Ltd [1944] AC 328. Copyright arises only by the operation of statute: in Australia. Charles II of England encouraged the passing of the Licensing Act of 1662. dramatic. The New Zealand legislation is the Copyright Act 1994. 737 F. v Rural Telephone Service Co. However. An idea is not protected until it is documented in writing or recorded in some way. films. Original ‘works’. musical or artistic.5 The former is dealt with by Part III of the Copyright Act and 1 8 Anne c 19. . during the Times therein mentioned’. 3 Copyright is specifically a federal power pursuant to Australian Constitution. at its basic level. Copyright arises once a work is written down. it protects only against the copying of a work. registration of a declaration of copyright is not necessary. is the right to copy. 5 See APRA v Commonwealth Bank of Australia (1993) 25 IPR 157. Inc. not against independent creation.

and music and video clips. whichever is the earliest of those events. Web pages may include graphics and images. compilations. performed in public or broadcast.8 If the first publication of a literary. the internet is a mixture of original works and secondary works. musical or artistic work is anonymous or pseudonymous. . to do all or any of the following acts: (i) to reproduce the work in a material form. musical or artistic work lasts for 70 years after the end of the calendar year in which the author of the work died. (v) to make an adaptation of the work. Copyright Act (Cth) s24.COPYRIGHT ISSUES 91 the latter by Part IV. or records of the work are first offered or exposed for sale to the public. However. (ii) to publish the work. dramatic. Generally copyright in a literary. copyright lasts for 70 years after the end of the calendar year in which the work was first published. in relation to a work that is an adaptation of the first-mentioned work. performed in public. and 6 7 8 9 10 Copyright Act (Cth) s33(2). dramatic. the period of protection runs from the death of the last surviving joint author. before the death of the author of a literary work (other than a computer program) or a dramatic or musical work. at any time before the end of the period the identity of the author of the work is generally known or can be ascertained by reasonable inquiry. From a copyright perspective. Exclusive rights The Copyright Act grants certain exclusive rights to the holder of the copyright depending upon the type of work:10 31(1) For the purposes of this Act. is the exclusive right: (a) in the case of a literary. 50 years in New Zealand.6 If. the work had not been published. The copyright in a secondary work exists independently of the copyright in the original work. (iii) to perform the work in public. any of the acts specified in relation to the first mentioned work in subparagraphs (i) to (iv). text. see Copyright Act 1994 (NZ) s16. inclusive. each of which is likely to be protected by copyright. or broadcast. the period is calculated from the death of the author. (iv) to communicate the work to the public. in relation to a work. Copyright Act (Cth) s33(4). unless the contrary intention appears. copyright. and records of the work had not been offered or exposed for sale to the public. For New Zealand. Copyright Act 1994 (NZ) s22. if.9 Where the work is the product of joint authorship. (vi) to do. copyright lasts for 70 years after the end of the calendar year in which the work is first published.7 A reference to the doing of an act in relation to a work includes a reference to the doing of that act in relation to an adaptation of the work. dramatic or musical work. Copyright Act (Cth) s33(3).

for example. below. Copyright Act 1968 (Cth) s116. the court is directed by the Copyright Act to have regard to the likelihood of other infringements.16 In addition. others). Copyright Act 1968 (Cth) s115(5). See Peer-to-peer file sharing. to do all or any of the following acts: (i) to reproduce the work in a material form. See Copyright Act 1968 (Cth) s39(1). ‘article’ includes a reproduction or copy of a work in electronic form.92 LAW OF ELECTRONIC COMMERCE (b) in the case of an artistic work. as the court thinks fit) and either damages or an account of profits’. presumably. Indirect infringement includes the importing of infringing articles. to enter into a commercial rental arrangement in respect of the work reproduced in a sound recording. selling or conducting other trade dealings with infringing articles and permitting a place of public entertainment to be used for a public performance of a work. Direct infringement is where a person exercises an exclusive right of the copyright owner without permission.11 There may be additional damages for flagrant breaches or as punishment. and (d) in the case of a computer program. involves direct copying. (7) and (8).15 Generally the infringement occurs where a ‘substantial part’ of the work is copied. In determining whether the proved infringement and the likely infringements were on a commercial scale. . if any. (6). (iii) to communicate the work to the public. 11 12 13 14 15 16 Copyright Act 1968 (Cth) s115(2). generally there needs to be proof of a sufficient degree of objective similarity between the work and the copy. and a causal connection between the two works. (ii) to publish the work. and ss119–125. For the purposes of this consideration. The aggrieved party may also claim damages for conversion and delivery up of infringing copies or plates used for making such copies. Coogi Australia Pty Ltd v Hysport International Pty Ltd [1998] FCA 1059. as well as the proved infringement.14 The downloading of music from the internet. the court must take into account the volume and value of any articles that are infringing copies and any other relevant matter.13 Infringement Infringement may be direct or indirect.12 Where a proved infringement on a commercial scale involves a communication of a work to the public. to deter the infringer (and. The relief that a court may grant in an action for an infringement of copyright includes ‘an injunction (subject to such terms. and it is likely that there were other infringements of the copyright by the defendant that the plaintiff did not prove in the action. Copyright Act 1968 (Cth) s14. to enter into a commercial rental arrangement in respect of the program. and (c) in the case of a literary work (other than a computer program) or a musical or dramatic work.

24 (1992) 173 CLR 330 at 346. 2d 310. The copyright holder now has the right to make an adaptation (this includes translations) of the work and to do all the things with that adaptation that are allowed to be done with the work itself. 25 (1992) 176 CLR 300 at 311. . . . Warner Bros Pictures v Majestic Pictures Corp. Judge Robert Grier held that copyright applies only to the ‘precise words’. Consultations [1982] Ch 119. 21 Hawkes & Son (London) Ltd v Paramount Film Service Ltd [1934] 1 Ch 593. . In 1853 Harriet Beecher Stowe sued to stop an unauthorised German translation of her novel Uncle Tom’s Cabin – and lost.COPYRIGHT ISSUES 93 Substantial part Copyright is infringed where the work or a substantial part of the work has been copied. It was critical . 201 (CCED Pa 1853). . In 1870 the US Congress remedied this position. emphasis added. 23 (1993) 176 CLR 300. emphasis added. Dawson J said that the 127-bit series was ‘a substantial. and is determined on a case by case basis. House of Lords. as have all modern jurisdictions. v Palmer (1992) 970 F. . 20 Ladbroke (Football) Ltd v William Hill (Football) Ltd [1964] 1 WLR 273. the series . v Exxon Ins.21 The question of whether or not something is a substantial part of a computer program created difficulty in Autodesk Inc. Cas. 26 (1992) 176 CLR 300 at 330. Calling a translation ‘a copy of the original’. . See also Blackie & Sons Ltd v Lothian Book Publishing Co. there is. 22 (1992) 173 CLR 330. 31(1)(a)(i) and (b)(i).23 The question centred on a 127-bit series. 2 (Autodesk cases). emphasis added. part of that program . But as used in the program they were an important construct.17 What constitutes a substantial part is a question of fact. v Dyason No. Nevertheless.26 17 See Copyright Act 1968 (Cth) ss14.24 Brennan J said that the series was ‘but a minute fraction of the bytes in the whole . is both original and critical’. 19 Copyright Act 1968 (Cth) s31(1)(a)(vi) and (vii).19 Prior to the internet and computer programs. his Honour described as ridiculous the proposition that the translation was a breach of the copyright. . Pty Ltd (1921) 29 CLR 396. 2d 1067. the cases established that the most important factor in determining whether or not the part of the work copied was a substantial part was the quality of what was copied rather than the quantity. v Dyason No. 18 Stowe v Thomas 23 F. . [it] processes the information which it receives’. (1934) 70 F. in my view.18 Notwithstanding that the entire work was involved. Exxon Corp. 122 and Autodesk Inc. . The 127 bits were tiny. typically representing a mere 16 characters in a typed document.25 Gaudron J said that the series was ‘the linchpin of the program . titles of works. program. simply no basis for an argument that the [series] was not a substantial part’. .20 Copying a few notes of music of a popular song could constitute a substantial part if those notes constitute the main theme of the song. indeed essential. short phrases and slogans. Arica Institute Inc.

if even one character is altered and so it could be argued that each character is ‘essential’. There was no allegation that Dr Bennett copied the source code of the Huffman algorithm from the original program.94 LAW OF ELECTRONIC COMMERCE In Data Access Corporation v Powerflex Services Pty Ltd27 (Data Access) the High Court considered the approaches in the Autodesk cases to come close to a ‘but for’ analysis: ‘but for’ the 127-bit series. although Gaudron J published a separate judgment explaining her Honour’s position. or at best [would] not work as desired’. could be sufficiently original to be a substantial part of the computer program in the right circumstances. only making a separate comment regarding her Honour’s earlier judgment in Autodesk v Dyason No. 2) Mason CJ had dissented. emphasis added. but as a common character it might be encoded instead as the bit string ‘101’. will be ‘unlikely’ to have reproduced a substantial part of the computer program. In evidence Dr Bennett. it is important to inquire into the importance which the taken portion bears in relation to the work as a whole: is it an ‘essential’ or ‘material’ part of the work?30 The High Court in Data Access was unable to agree with the approach taken by the majority in the Autodesk cases. . Pumfrey J observed of Autodesk (No. 30 (1993) 176 CLR 300. explained the method.31 This process could be used for many letters. 27 [1999] HCA 49. stating that ‘substantial part’: refers to the quality of what is taken rather than the quantity . . a person who does no more than reproduce those parts of a program which are data or related information and which are irrelevant to its structure (that is. Dr Bennett wanted the plaintiff’s original program to be able to compress and decompress his files.28 in the English Patents Court. a computer program may not work. the third respondent. 28 [2000] RPC 95.29 In Autodesk (No. strings and phrases. stating. 131. 114. 29 [2000] RPC 95. McHugh. considered alone. or may not work as planned. The High Court felt that there was ‘great force’ in the criticism that the ‘but for’ essentiality test was not practicable. 31 [2000] RPC 95. 2 (1993) 176 CLR 300. . Mason CJ’s dissenting opinion was preferred. In Cantor Fitzgerald International v Tradition (UK) Ltd. The Huffman compression is a method of reducing the amount of memory space consumed by data files. that are not choice of commands and combination and sequencing of commands). The High Court noted that in general. The reasoning in the Autodesk cases did not find favour with the High Court.5 per cent. Accordingly. with a space (and thus also efficiency) saving of 62. Gummow and Hayne delivered a joint judgment with which Gaudron J agreed effectively in full. The High Court used the term ‘unlikely’ in preference to ‘impossible’ because it conceived that data. 1) that it ‘would result in any part of any computer program being substantial since without any part the program would not work. the program would not work. for example that the letter ‘e’ was normally encoded as the bit string ‘01100101’. 305. Gleeson CJ. In Data Access the High Court also considered whether a ‘Huffman Compression’ table was a literary work.

Pty Ltd v Edwards Hot Water Systems. Causal connection may be proved directly or indirectly. below. An exact duplicate will be objectively similar. reproduction means copying. (1985) 159 CLR 466. 472. The copying may be unconscious. he needed to be able to replicate precisely the default Huffman compression table. Nevertheless. Both the High Court and the Full Federal Court considered that the process undertaken by Dr Bennett constituted a ‘reproduction’ of the original Huffman table: The fact that Dr Bennett used an ingenious method of determining the bit string assigned to each character does not make the output of such a process any less a ‘reproduction’ than if Dr Bennett had sat down with a print-out of the table and copytyped it. Gibbs CJ. the copyright work. involves two elements – resemblance to. if he does copy. His evidence was that he refrained from ‘decompiling or looking inside the Dataflex runtime’. This ‘reverse engineering method’ was highly ingenious.33 Objective similarity and causal connection The requisite degree of similarity depends on the type of work. or. the High Court held that the original Huffman table fell ‘squarely within the statutory definition of a literary work’. Two pieces of computer software may be objectively similar if one has been translated into another computer language. such as the reproduction of music heard years before. 276. 124. and does not include cases where an author or compiler produces a substantially similar result by independent work without copying. Objective similarity may arise after transformation into another media. to adopt the words which appear in the judgment of Willmer LJ in Francis Day & Hunter Ltd v Bron (1963) Ch 587. for the purposes of copyright law. and instead carried out a process to recreate and deduce the original table. Lord Reid said. 32 33 34 35 See Software. the deliberate copying of computer data may also produce something that is objectively similar. in Ladbroke (Football) Ltd v William Hill (Football) Ltd:35 Broadly. See also Francis Day & Hunter Ltd v Bron [1963] Ch 587. And. and actual use of. in SW Hart & Co. at p 614. .32 Consequently.COPYRIGHT ISSUES 95 and for his program to compress and decompress other files in an identical way so that the programs could work together. [2000] RPC 95. such as a book into a film. Dr Bennett did not have access to the original file. (1964) 1 WLR 273. the question whether he has copied a substantial part depends much more on the quality than on the quantity of what he has taken.34 described the test in the following terms: The notion of reproduction. ‘a sufficient degree of objective similarity between the two works’ and ‘some causal connection between the plaintiffs’ and the defendants’ work’.

or any other type of work. rewriting the whole of the provisions that deal with copyright in computer programs’. defined as: a set of statements or instructions to be used directly or indirectly in a computer in order to bring about a certain result. can be resolved only by the legislature reconsidering and. ‘matters . in Computer Edge v Apple. however. 38 [1999] HCA 49. He was aware that copying the original source code would be a copyright breach. only making a separate comment regarding her Honour’s earlier judgment in Autodesk v Dyason No. 2 (1993) 176 CLR 300. The court’s finding that the respondents infringed the appellant’s copyright in the computer compression table was described as having ‘considerable practical consequences’. . .96 LAW OF ELECTRONIC COMMERCE Software In the past quarter-century the courts and the legislature have grappled with copyright issues of software and computer programs. if it thinks it necessary or desirable. 39 [1999] HCA 49. He ‘duplicated’ and used certain commands and ‘Reserved Words’ (the precise words used by Dataflex to operate the program). Gummow and Hayne delivered a joint judgment with which Gaudron J agreed effectively in full. 37 Copyright Act 1968 (Cth) s10.40 Dr Bennett became familiar with the applicant’s ‘Dataflex’ system and decided to create and market an application development system which would be compatible with the Dataflex database file structure so that persons who were familiar with the Dataflex system would be able to use his new product. in machine language. . Gleeson CJ. Computer code may be as basic as a series of unintelligible (to the human reader) ones and zeros. The court. McHugh. Dr Bennett created computer programs compatible with the Dataflex system.39 There are significant ramifications for anyone who seeks to produce a computer program that is compatible with a program produced by others. It was not denied that great care and skill were involved in creating the code. stated. was quite different from the original. By a process of reverse engineering and study of both the documentation and operation of the Dataflex system. concerned about the impact of its decision. This resulted in an amendment to the Copyright Act expanding ‘literary works’ to include a computer program. In 1986. The underlying source code. but it did not fit in with the then definition of literary work. or one of dozens of other computer languages with varying degrees of readability. The Full Court of the Federal Court of Australia held that commands in a computer program were not original literary works within the 36 (1986) 161 CLR 171. 40 [1999] HCA 49. para 125. The High Court was unable to classify computer code as a literary work. so he avoided doing so directly.37 The new definition was tested by the High Court in Data Access Corporation v Powerflex Services Pty Ltd38 (Data Access). para 125.36 the High Court of Australia held that the Copyright Act did not apply to software.

such as a teletext service. technology-neutral right of communication to the public. each one was merely a single word. musical. Copyright Act 1968 (Cth) s10. The majority went to some lengths to explain the nature and characteristics of computer code and even set out three short examples of such code.44 However. or a combination of paths . that provides no more than data or no more than text (with or without associated images).COPYRIGHT ISSUES 97 meaning of the definition in section 10 of the Copyright Act. ‘Broadcast’ is defined as: ‘a communication to the public delivered by a broadcasting service within the meaning of the Broadcasting Services Act 1992 (Cth)’.42 ‘Communicate’ is defined as: ‘make available online or electronically transmit (whether over a path. The definition of a ‘computer program’ requires that the set of instructions be intended to cause the computer to perform a particular function. a set of Reserved Words is not a ‘computer program’. emphasis added. The High Court asked whether each of the Reserved Words constituted a ‘computer program’ within the meaning of section 10(1) of the Act. The simple listing does not cause a computer to perform any identifiable function. artistic and dramatic works. None of the Reserved Words met the criteria set out in section 10. sound recordings. The High Court held that although each Reserved Word was ‘undoubtedly’ in ‘code or notation’. The right is an exclusive right (for the copyright holder) in literary. Copyright Act 1968 (Cth) s31(1)(a)(iv) and (b)(iii). ordering. so it permits Australian copyright holders to control communication directed to overseas audiences.45 The communication right includes cable transmissions and encompasses the uploading of material onto an internet server. . Copyright Act 1968 (Cth) s10. It is the particular selection.41 The High Court held that it is not appropriate to relate the Reserved Word back to the underlying computer code to which it refers. The right does not apply to the physical distribution of copyright material in a tangible form (such as the distribution of hard copies of books). The technology-neutral approach can apply to an electronic transmission by copper wires.43 The right replaced and extended the pre-existing technology-specific broadcasting right. The expression ‘to the public’ includes the public within or outside Australia. . . including a dial-up service’. Similarly. The new right does not apply to published editions. optic fibre cables and microwaves. films and broadcasts. and so copyright did not subsist in them. Broadcasting Services Act 1992 (Cth) s6. a broadcasting service does not include ‘a service. or a service that makes programs available on demand on a point-topoint basis. )’. 41 42 43 44 45 Computer programmers will observe curious use of computer code in their Honours’ judgment. combination and arrangement of instructions within a computer program which provide its expression. Right of communication In 2000 the centrepiece of amendments to the Copyright Act was a new broadly based.

98 LAW OF ELECTRONIC COMMERCE Exemptions The Copyright Act exempts dealing with copyright material without the permission of or payment to copyright owners where such use is for the purposes of ‘research and study. and for other libraries for certain purposes. being a machine installed by or with the approval of the body administering a library or archives on the premises of the library or archives. parody or satire. This is designed to minimise unreasonable conflict with the emerging markets of copyright owners. 43. This access must be provided in a way which will not unreasonably prejudice the interests of copyright owners.47 There are several other exemptions. the Copyright Act was amended to remove liability from the library where conspicuous warning notices are in place. and (b) there is affixed to.48 Infringing copies made on machines installed in libraries and archives Following concern over the possibility of legal action against libraries when photocopiers were first introduced. and professional legal advice’. The fair dealing under these circumstances is either 10 per cent of the number of words in the work or adaptation. The Copyright Act includes such permission for electronic reproduction and communication of copyright material. a notice of the prescribed dimensions and in accordance with the prescribed form. a library may only request an article or a portion of a work in electronic form from another library if that portion or article is not available ‘within a reasonable time at an ordinary commercial price’.46 Specific provisions which deal with electronic works are now included as well: there is a fair dealing for research and study related to a published literary work in electronic form (except a computer program or an electronic compilation. 176. or in close proximity to. or if the work or adaptation is divided into chapters. or outside those premises for the convenience of persons using the library or archives. a published dramatic work in electronic form or an adaptation published in electronic form of such a literary or dramatic work. . Copyright Act 1968 (Cth) s40. 46 47 48 49 See Copyright Act 1968 (Cth) ss40–42 and Copyright Act 1994 (NZ) ss42. in a place readily visible to persons using the machine. However.49 More recently this was extended to copies by computers: Where: (a) a person makes an infringing copy of. the machine. or of part of. See University of New South Wales v Moorhouse (1975) 133 CLR 1. certain restrictions apply: for example. a work on a machine (including a computer). a single chapter. criticism and review. These are referred to as the ‘fair dealing’ exemptions. Libraries and archives Libraries and archives are permitted to make reproductions of copyright material for library users for the purposes of research and study. such as a database). Copyright Act 1968 (Cth) Div 5. reporting the news.

The provision also applies to archives. Temporary reproductions When a web page is accessed. including the making of such temporary files. The Act covers both temporary reproductions made in the course of communication and temporary reproductions of works as part of a technical process of use.51 That is. should the user make any other copy. 43B respectively. commercial dealing. However.50 Educational statutory licences Part VB of the Copyright Act permits educational institutions with a statutory licence to make copies of works subject to the payment of equitable remuneration. the user’s web browser makes a copy of the text and graphics on the website and places both in a temporary directory or cache. Alan Davidson. Early questions arose about unauthorised copies of material subject to copyright. must be implied. such as cutting and pasting or some other use of the temporary files. the text and graphics may remain in place indefinitely. One early opinion was that there was an implied licence. Depending on the extent of use of the web browser and the size reserved for such files. making available online. (2001) 21–3 Proctor.53 A ‘circumvention device’ is defined as: 50 51 52 53 Copyright Act 1968 (Cth) s39A. Copyright Act 1968 (Cth) ss43A. giving statutory effect to the implied licence concept. marketing and supply of a circumvention device or service used to circumvent technological protection measures such as program locks. The Copyright Act provides that temporary or incidental reproductions made in the course of the technical processes of exercising the communication right are exempt. if the holder of the copyright placed material on the internet it could be implied that normal use of the internet. such an implication could not be made. Copyright Act 1968 (Cth) ss116AK–116AQ. The Part applies to the reproduction and communication of works in hardcopy form or in electronic form. ‘Digital agenda amendments to the Copyright Act’. 30.52 Enforcement measures The Copyright Act helps copyright owners enforce their rights in the digital environment by providing enforcement regimes for circumvention devices and services. . rights management information and broadcast decoding devices. The enforcement measures are designed to combat piracy. importation. advertising.COPYRIGHT ISSUES 99 neither the body administering the library or archives nor the officer in charge of the library or archives shall be taken to have authorized the making of the infringing copy by reason only that the copy was made on that machine. The Act includes civil remedies and criminal sanctions against the manufacture.

100 LAW OF ELECTRONIC COMMERCE a device. prevents. other than the circumvention of the technological protection measure. product. or on behalf of.56 Many products now incorporate Rights Management Information (RMI). with the permission of. Copyright Act 1968 (Cth) s10. The Copyright Act includes criminal offences and civil remedies regarding the intentional removal and alteration of RMI. or (iv) if the work is a computer program that is embodied in a machine or device– restricts the use of goods (other than the work) or services in relation to the machine or device. and (ii) in the normal course of its operation. component or product (including a computer program). product. or no such purpose or use. or which appears in connection with a communication. 54 55 56 57 58 Copyright Act 1968 (Cth) s10. such as DVD recorders and computers. and its author or copyright owner or identifies or terms and conditions on which the work or subjectmatter may be used. advertised or marketed as having the purpose or use of circumventing the technological protection measure. the owner or exclusive licensee of the copyright in a work or other subject-matter.57 ‘Electronic rights management information’ is defined as: information that is attached to or embodied in a copy of the work or subject-matter. Copyright Act 1968 (Cth) s10. or (b) a device.55 A ‘technological protection measure’ generally means: (a) an access control technological protection measure. technology or component to the extent that it: (iii) if the work or other subject-matter is a cinematograph film or computer program (including a computer game) – controls geographic market segmentation by preventing the playback in Australia of a non-infringing copy of the work or other subject-matter acquired outside Australia. A ‘circumvention service’ has a corresponding meaning. inhibits or restricts the doing of an act comprised in the copyright. Copyright Act 1968 (Cth) ss116B–116D. . which identifies the work or subject-matter. or (c) is primarily or solely designed or produced to enable or facilitate the circumvention of the technological protection measure’. that: (a) is promoted. or (b) has only a limited commercially significant purpose or use. but does not include such a device. or the commercial dealing with copyright material where the RMI has been removed. or the making available. technology or component (including a computer program) that: (i) is used in Australia or a qualifying country by.58 This includes digital watermarks. Copyright Act 1968 (Cth) s10. of the work or subject-matter.54 This definition includes software tools and is intended to exclude general purpose electrical equipment.

unless it can be proven that either had authorised the infringement by a user. A photograph may be converted from a print to an electronic image. is allowed to make a copy of that recording. A video may be copied into a digital format. format-shifting and space-shifting Time-shifting of television and radio programs for later private use is permitted. although it may be implied that the exception is not meant to permit permanent copies or repeated use. provided the copy is made from a non-infringing copy owned by the individual. or conversely an electronic image may be printed.62 59 See Copyright Act 1968 (Cth) ss39B. www.60 The exception does not generally apply to podcasts or webcasts. The device could be a CD player. a computer. rent or distribution other than to a member of the person’s family or household. 60 Copyright Act 1968 (Cth) s111. There is no express obligation to destroy the recording at any time.copyright. This provides an exemption for the carrier or the Internet Service Provider (ISP). Format-shifting involves copying from one ‘format’ to another for private use. For example. photographs. print material may be scanned for viewing on a computer screen. . for private and domestic use. Space-shifting means that a person who owns a copy of a sound recording. or played or shown in public or broadcast. The recording of television or radio programs solely for private and domestic use by watching or listening to the material broadcast at a time more convenient does not infringe copyright. 195AW. or a portable device such as an MP3 player or iPod.pdf. An individual may copy books (including novels. but does not apply to podcasts. such as a CD.au/pdf/acc/infosheets_pdf/g097. (2008) Information Sheet GO97v01. children’s books.59 Time-shifting. to play on another device owned by that person. a car CD player. 61 Copyright Act 1968 (Cth) s109A. 195AXI. 116AA–116AJ.61 The provision does not apply if the initial copy is an infringing copy (such as a pirated CD or an unauthorised digital download).COPYRIGHT ISSUES 101 A person will only be directly liable for copyright infringements involved in a communication where they have determined the content of that communication. reference books). The provision also does not apply if the second copy is later sold. or played or shown in public or broadcast. The provision may apply to recorded music from a digital download. rented or distributed (other than to a member of the person’s family or household). and films on videotape but not DVDs. 62 See generally Australian Copyright Council. and does not apply if the recording is later sold. The provision does not apply to sales. rented or distributed (other than to a member of the person’s family or household). newspapers and other periodical publications (such as magazines and journals). org.

3d 1004 (9th Cir 2001). 64 Copyright Act 1968 (Cth) s31.64 Peer-to-peer (P2P) transfers have facilitated the majority of the downloads. such as pay television. Australia and New Zealand do not have a general fair use defence. Napster argued that each transfer was in fact a personal transfer within the meaning of the fair use principle. v Napster Inc. video and other files online is prolific. Yet sites providing access. it includes likely infringements as well as proved infringements when infringement takes place online on a commercial scale. comment. Transfers of copyright material – material that would have cost several billion dollars in total to buy – are a source of considerable concern for the music industry. Colloquially this is referred to as piracy. typically indirectly on a P2P basis. The Ninth Circuit Court rejected Napster’s claim that the online service and alleged infringements were exempted by the ‘fair use’ defence. ‘Fair use’ is defined in the US copyright statute thus: the fair use of a copyrighted work. teaching (including multiple copies for classroom 63 See Copyright Act 1968 (Cth) ss115(5)–(8). 65 239 F. and that the right to copy is one of the many exclusive rights provided by the Copyright Act. Part VAA. is typically disregarded by internet users.65 was the first significant case challenging P2P transfers for copyright material online. . The US decision of A & M Records Inc. including such use by reproduction in copies or phonorecords or by any other means specified by that section. The fact that a substantial number of such files are subject to copyright. There are also offences relating to unauthorised access to encoded broadcasts.) The transfer of files without copyright protection is uncontroversial – there is thus considerable legitimate benefit to be gained by using P2P when copyright is not infringed. This is a question of supply attempting to meet demand notwithstanding legal and perhaps moral concerns. continue to flourish. news reporting. instead they have a relatively narrow range of ‘fair dealing’ defences for specific circumstances. if not epidemic. The transfer of files without copyright protection is uncontroversial. 132AC. (This claim was based on the fact that international copyright law is generally more lenient on personal file sharing where fair use is involved.102 LAW OF ELECTRONIC COMMERCE Piracy and enforcement Conduct regarded as ‘substantial infringement on a commercial scale’ attracts special attention. There have been numerous cases brought before the courts aimed at stopping or at least discouraging these downloads. for purposes such as criticism.63 Peer-to-peer file sharing The downloading of music. Copyright law in the United States is governed by the United States Copyright Act 1976.

In LA Times v Free Republic67 the court found that the posting of material with no commercial motive or intent nevertheless allowed others to avoid paying the customary price charged for the works. applying these four determining factors. it need merely be capable of substantial noninfringing uses. unobjectionable purposes. Posting material to a website can be in breach even if the host’s intention is not commercial. is not an infringement of copyright. does not constitute contributory infringement if the product is widely used for legitimate. the purpose and character of the use. The court rejected the defence that the fair use of the end users protected Napster. and was thus an infringement. the nature of the copyrighted work. It questioned whether sampling and space-shifting were protected in any event.68 This pre-internet case held that making recordings of television programs to be viewed later.COPYRIGHT ISSUES 103 use). scholarship. were liable for contributory infringement. 464 US 417 (1984) at 442. and 4. 3. the amount and substantiality of the portion used in relation to the copyrighted work as a whole. §107. The US Supreme Court. Universal Studios and other joint applicants argued that the manufacturers of Betamax and VCR devices and of the corresponding blank tapes authorised infringing copies by the purchasers of the tapes or. by a majority of 5–4. In determining whether the use made of a work in any particular case is a fair use the factors to be considered shall include— 1. the court determined that Napster had played an integral role in the transfer process and could have blocked access to infringing material had it chosen to do so. 54 USPQ 2d 1453 (2000). have permitted the sharing of material with family or friends. Attempts have been made by file-sharing proprietors to rely on the principle enunciated in Sony Corp. the effect of the use upon the potential market for or value of the copyrighted work. alternatively.66 The US courts. like the sale of other articles of commerce. including whether such use is of a commercial nature or is for nonprofit educational purposes. Subsequent online file-sharing programs took note of the Napster case and attempted to circumvent the court’s concerns by decentralising their databases and removing their direct ability to control or track transfers. Indeed. In the Napster case.69 66 67 68 69 United States Copyright Law 1976. The court ruled that: the sale of copying equipment. was fair use. held that there must be a balance between a copyright holder’s legitimate demand for effective protection of the statutory monopoly and the rights of others freely to engage in substantially unrelated areas of commerce. 464 US 417 (1984). . known as timeshifting. or research. 2. v Universal City Studios.

Wilcox J stated that he was ‘anxious’ not to make an order which the respondents would not be able to obey except at the unacceptable cost of preventing the sharing even of files which did not infringe the applicants’ copyright. Despite the fact that the Kazaa website contained warnings against the sharing of copyright files. and a significant amount of detail by necessity was lacking. in 2005 in MGM v Grokster. Wilcox J ordered that a comprehensive filtering system and update process be put in place. the court held that the market for the original photographs was not substantially diminished. and in fact that the thumbnails may increase demand.70 in line with the Napster case. copyright infringements by users. It also announced that it would no longer offer P2P file sharing citing the Supreme Court case as the reason. the US Supreme Court unanimously held filing-sharing proprietors Grokster and Streamcast liable for authorising others to infringe copyright: We hold that one who distributes a device with the object of promoting its use to infringe copyright. The issues of thumbnails. It was questionable whether the low-resolution images could be regarded as a full replication. The court regarded their use as reasonable and necessary. inline linking and fair use were considered in Kelly v Arriba Soft Corporation. and an end user licence agreement under which users agreed not to infringe copyright. and professional legal advice. 3d 811(CA9 2003). or even to substantially curtail. Wilcox J ordered a complex series of arrangements including declarations and an order restraining future violations. is liable for the resulting acts of infringement by third parties. The 9th Circuit Court of Appeals applied the four factors for fair use. 71 336 F. and held that creating the thumbnail images as previews was ‘transformative’ only. Most significantly. In the Federal Court of Australia in Universal Music Australia Pty Ltd v Sharman License Holdings Ltd72 Wilcox J considered the P2P file-sharing system known as Kazaa. In granting relief. It had ‘long been known’. 72 [2005] FCA 1242.71 The defendant used online thumbnail images of copyright material which linked to further information and data. Finally. criticism and review. said Wilcox J. as shown by clear expression or other affirmative steps taken to foster infringement.104 LAW OF ELECTRONIC COMMERCE However. His Honour stated that Kazaa may continue if 70 545 US 913 (2005). it had ‘long been obvious’ that those measures were ineffective to prevent. The infringing respondents were restrained from authorising Kazaa users to do any of the infringing acts in relation to any sound recording of which any of the applicants were the copyright owners. Grokster was ordered to pay US$50 million to the music and recording industries. that Kazaa was widely used for the sharing of copyright files. The images were not intended to be viewed at high resolution like the original artwork. . but does include the four factors found in the US legislation permitting fair use. reporting the news. Australian copyright law includes fair dealing defences for research and study. parody or satire.

and without the licence of the owner of the copyright. . The website included links to music files on websites which were independent of Cooper. Branson and Kenny JJ. The action included more than 40 parties. . Stephen Cooper was the registrant of the domain name mp3s4free. . . and second. particularly considered the meaning of ‘authorising’ an infringement of copyright in the context of websites. The Full Federal Court’s decision helped clarify two important issues: first. to the user. whether or not a person has authorised the doing in Australia of any act comprised in a copyright . not being the owner of the copyright. the meaning of ‘authorisation’ of copyright infringement in a sound recording. the application of section 112E of the Copyright Act in relation to the protection of the carrier. In Cooper v Universal Music Australia Pty Ltd73 the Full Federal Court considered the position of the website www. Section 101 deals with infringement by doing acts comprised in copyright: (1) . adaptation or other subject-matter. . The Federal Court at first instance74 found that Cooper. The decision of the Full Federal Court. French. Authorisation Section 13(2) provides.COPYRIGHT ISSUES 105 a protocol. by providing a website with hyperlinks. The links facilitated the transmission of music files.net and relevant provisions of the Copyright Act 1968 (Cth). so may ISPs. Cooper appealed on the grounds that Tamberlin J erred in finding that. which included detailed filter technology that was updated regularly were put in place. an adaptation of a work or any other subject-matter includes the exclusive right to authorize a person to do that act in relation to that work. the web hosts and directors of the companies had infringed copyright. 74 Universal Music Australia Pty Ltd v Cooper [2005] FCA 1878. without the licence of the owner of the copyright. . . commenced proceedings against Cooper.net. The web hosts and directors also appealed. any act comprised in the copyright. and in certain circumstances. he authorised the making of copies of the sound recordings and the communication to the public of those recordings without the licence of the record companies. typically in MP3 format. the ISP hosts and certain named directors for copyright infringement. and concluded that website hosts may be liable for authorising copyright infringement. who held the copyright in the many of the music files. in part: the exclusive right to do an act in relation to a work.mp3s4free. the matters that must be taken into account include the following: 73 [2006] FCAFC 187. Several record companies. or authorizes the doing in Australia of. does in Australia. a copyright subsisting by virtue of this Part is infringed by a person who. (1A) In determining .

which had been inserted by the Copyright Amendment (Digital Agenda) Act 2000 (Cth). in this case. internet users from using links to copy sound recordings in which copyright subsisted. The principal content of the website was links to other websites and files on other servers. he did not have any relevant power to control its use or prevent users from accessing and using this site for the purpose of copying music. See generally paras 41–45. [2006] FCAFC 187. para 41. at the time of the doing of each relevant act comprised in a copyright subsisting by virtue of the Act. para 41.78 Section 101(1A)(b) deals with the nature of the relationship between.75 Pivotal to the court’s reasoning was the application of section 101(1A). as he could determine not to make available this website. Cooper submitted that 75 76 77 78 The two different spellings of ‘authorise’ are faithfully replicated for the provision. making available to the public a technical capacity calculated to lead to the doing of that act. The hyperlinks could be automatically added to the mp3s4free website. The court further concluded that within the meaning of section 101(1A)(a). the court rejected the contention that unless Cooper had power. (c) whether the person took any other reasonable steps to prevent or avoid the doing of the act.76 Cooper was responsible for creating and maintaining the mp3s4free website. The court’s conclusion was that: a person’s power to prevent the doing of an act comprised in a copyright includes the person’s power not to facilitate the doing of that act by. which he knew was designed to permit downloading of music files.77 The ‘inexorable inference’ is that Cooper made a deliberate choice to establish and maintain this website in a form which did not give him the power immediately to prevent. (b) the nature of any relationship existing between the person and the person who did the act concerned. for example. Cooper argued that once the website was established. The court reasoned that Cooper had the power to prevent the infringement of copyright. the ISP host and that company’s director separately. [2006] FCAFC 187. including whether the person complied with any relevant industry codes of practice. or immediately to restrict.106 LAW OF ELECTRONIC COMMERCE (a) the extent (if any) of the person’s power to prevent the doing of the act concerned. In relation to section 101(1A)(a). he had no relevant power within the meaning of paragraph. The court considered the position of Cooper. It was the intentional choice of Cooper to establish his website in a way which allowed the automatic addition of hyperlinks. Cooper did have power to prevent the communication of copyright sound recordings to the public in Australia via the website. Cooper and the person who downloaded the music. . to prevent its being done. the overwhelming majority of which were the subject of copyright.

(1926) 2 KB 474. in part: When you download a song.80 The disclaimer stated. (1928) 40 CLR 481. the court considered that an aspect of the relationship was the deliberate attraction of the user-friendly website for downloading. at 489.COPYRIGHT ISSUES 107 he did not have any relationship with people who made MP3 files generally accessible over the internet or with people who downloaded such files. However. The court considered that Cooper benefited financially from sponsorship and advertisements on the website: that is. Cooper submitted that disclaimers on the website amounted to reasonable steps within the meaning of the paragraph.82 The Full Federal Court concluded that Cooper did not establish that he took any reasonable steps to prevent or avoid the use of his website for copying copyright sound recordings or for communicating such recordings to the public. or with reasonable suspicion that it is likely to be used for infringement. .83 The High Court held ‘authorise’ to mean to ‘sanction. The Full Federal Court considered the High Court decision in University of New South Wales v Moorhouse. countenance” ’: Falcon v Famous Players Film Co. para 87. 81 See para 100. Tamberlin J at first instance attributed little weight to them as he found their intended purpose was ‘merely cosmetic’. Adelaide Corporation v Australasian Performing Right Association Ltd [1928] HCA 10. .79 Section 101(1A)(c) deals with whether the person took any other reasonable steps to prevent or avoid the doing of the act. that the relationship between Mr Cooper and the users of his website had a commercial aspect.81 Indeed. This site only provides links to the according sites and no songs are located on our servers . in that case a photocopier. However. The word ‘authorise’ ‘has been held judicially to have its dictionary meaning of “sanction. 84 (1975) 133 CLR 1. 497. and who permitted it to be used for a copyright infringement knowingly. We are not responsible for any damage caused by downloading these files. approve or countenance’. 82 Universal Music Australia Pty Ltd v Cooper [2005] FCA 972. including complying with relevant industry codes of practice. para 10. 80 Para 49. 79 Para 48. or any content posted on this website or linked websites. Tamberlin J at first instance considered that the disclaimers indicate Cooper’s knowledge of the existence of illegal MP3s on the internet and the likelihood that some of the MP3s downloaded constituted infringing copies of copyright music and sound recordings. As a consequence Mr Cooper had a commercial interest in attracting users to his website for the purpose of copying digital music files. . at 491. . 83 (1975) 133 CLR 1. Mr Cooper’s benefits from advertising and sponsorship may be assumed to have been related to the actual or expected exposure of the website to internet users. None of the files on this site are stored on our servers. the court considered that the disclaimers misstated Australian copyright law in a material way and the inclusion did not constitute a reasonable step to prevent or avoid the infringement of copyright. you take full responsibility for doing so. We are just providing links to remote files . . approve.84 Gibbs J stated that a person who has control of the means by which an infringement of copyright could be committed.

who provides facilities for making. The contents of a retrieved web site may be protected by trade mark or copyright regulation. which provides that: a carrier . Trade mark and copyright issues arise. Instead a connection is made with the host. . typically for a fraction of a second. Most links will cause the web browser to retrieve the web page of another host. Fundamental to internet use and navigation are hyperlinks. the content is not a continuous stream. Some links are internal: that is. . and display the contents. unlike Cooper. The director. as on the facts he was the ‘controlling mind’ of the company. during which time the contents are copied to a cache or temporary area.108 LAW OF ELECTRONIC COMMERCE has authorised the breach. anywhere in the world. . .87 The question of the status and extent of protection available in relation to the ‘sign’ (for trade marks) or ‘copy’ (for copyright) displayed on the user’s computer has been the subject of speculation. was also held liable. it had the power to withdraw the hosting of Mr Cooper’s website. such as with television. graphics files and any other data are copied to the user’s computer. unless reasonable steps were taken to limit such use. The text. In relation to the ISPs the court found that: As all of the relevant acts of copyright infringement took place via Mr Cooper’s website.86 Hyperlinking Hyperlinks permit a copy of data. a communication is not taken to have authorised any infringement of copyright . 87 In relation to trade marks. the link will take the user to another web page by the same designer and author as the initial page. the ISP and the directors all claimed protection under section 112E of the Copyright Act. or facilitating the making of. With a simple click of a computer mouse a massive amount of information and data is available.85 Carrier protection Cooper. The court ruled out Cooper’s claim relatively perfunctorily. 86 Para 62. see Chapter 7. . did not have the ability to take reasonable steps to prevent the copyright infringement. images and other material to be downloaded onto the user’s computer. The target site will have a unique URL (Universal Resource Locator). merely because another person uses the facilities so provided to do something the right to do which is included in the copyright. The web browser assembles the 85 The Full Federal Court made the distinction between other parties who. . When viewing a website. . The Full Federal Court applied the Moorhouse case by analogy. Mr Bal. I conclude that E-Talk (the internet service provider) had power to prevent the doing of the acts concerned because .

au.88 the court held that: hyperlinking does not itself involve a violation of the Copyright Act .wipo. World Intellectual Property Organisation (WIPO): www. However. the customer is automatically transferred to the particular genuine web page of the original author. which provides: The copyright in a work. In Ticketmaster Corporation v Tickets.ipsanz.ipaustralia. has been untested.org. However.gov. is not infringed by making a temporary reproduction of the work or adaptation as part of the technical process of making or receiving a communication. whether this amounts to a breach of trade mark right or copyright. or ought to know that temporary copies are made as part of the operation of the World Wide Web. The question. . or copying the temporary files to another part of the user storage.org/about-ip/en/copyright. 88 54 USPQ 2d 1344 (CD Cal 2000).com Inc. at the very least. since no copying is involved . Temporary reproductions made in the course of the technical process of making or receiving electronic communications are excluded from the scope of copyright. IP Australia: www. the protection is inapplicable. albeit faster and more efficiently. This is analogous to using a library’s card index to get reference to particular items. The host almost always wants or expects the data to be displayed by web users.wipo. It is the host that has placed the material into a public area for access on the World Wide Web. if any further step is taken to make a copy. such as ‘cutting and pasting’ text from the screen. Intellectual Property Society of Australia and New Zealand: www. .au.com. an implied licence for the user to view the content. . it would be reasonable to assume that the host of the data has granted. . WIPO (Copyright): www.copyright. or an adaptation of a work. Further reading Australian Copyright Council: www.au. .COPYRIGHT ISSUES 109 copied material into a predetermined meaningful way. In Australia the issue was resolved with the inclusion of section 43A(1) .org. There is no deception in what is happening. The host knows.html.

Cybersquatting and related issues are discussed in Chapters 8 and 9. hyperlinking (particularly deep linking). 110 . or intended to be used. This chapter addresses issues relating to the impact of electronic commerce on the specific intellectual property rights of trade marks. for example. published and disseminated. Trade marks indicate a standard of quality 1 Trade Marks Act 1995 (Cth) s17. to distinguish goods or services dealt with or provided in the course of trade by a person from goods or services so dealt with or provided by any other person’. users and law makers. and the specific intellectual property type known as circuit layouts is described. framing in web pages and the use of meta-tags. This means that trade mark holders have a new frontier to battle. commercial or personal. patents and circuit layouts. patents and circuit layouts The digital revolution has necessitated a re-examination of intellectual property issues by intellectual property holders.1 A trade mark is used in the course of trade to show a connection between a particular business and the goods or services it supplies. Patents involving software and hardware are considered. on internet websites. The nature of trade marks A trade mark is ‘a sign used. Placing data. images. It is intended to be only a brief overview of the law in these areas. is child’s play. The nature of the digital age enables data to be easily copied. The chapter will discuss the use and design of the internet. logos and text. Misuse of their trade mark rights.7 Electronic commerce – trade marks. arises in relation to cybersquatting and domain names. including hyperlinks. deliberate or incidental. framing and meta-tags.

signature. heading. phrase or other distinctive sign and to stop others from using that mark or a deceptively similar mark in relation to the same or similar sorts of goods or services. Trade Marks Act 1995 (Cth) s20. word.2 Registrants only have the right to use their registered trade mark for the goods and services for which it is specifically registered.4 A registered owner also has ‘the right to obtain relief under the Act if the trade mark has been infringed’. sound and scent in 1995 significantly broadened the range of features or signs which can be registered. 2 3 4 5 6 For the New Zealand equivalent. see the Trade Marks Act 2002 (NZ). label. Trade Marks Act 1995 (Cth) s20. An Australian trade mark registration is effective throughout Australia. and (ii) to authorise other persons to use the trade mark in relation to the goods and/or services in respect of which the trade mark is registered and the right to obtain relief under the Act if the trade mark has been infringed. Trade Marks Act 1995 (Cth) s27. as long as the trade mark is actually used or intended to be used with respect to the goods or services nominated. colour. shape. Provided the trade mark is used continually and renewed. brand. PATENTS AND CIRCUIT LAYOUTS 111 associated with a product or service and protect consumers from confusion and deception. The system for registering trade marks effectively entitles a person to ‘own’ a word. shape. ‘the person has authorised or intends to authorise another person to use the trade mark’ or ‘the person intends to assign the trade mark to a body corporate that is about to be constituted’.6 Business names are not trade marks. logo.3 The inclusion of any aspect of packaging. Trade Marks Act 1995 (Cth) s6. device. The purpose of registering a business name or company name is to identify the owners operating under that name. . typically every 10 years. sound or scent’. Trade mark registration is territorial and each country has its own system of registration. name. Those wishing to protect trade marks (for trade purposes. A sign is defined as ‘including the following or any combination: any letter. colour. Trade marks are protected under common law and under the Trade Marks Act 1995 (Cth).TRADE MARKS. aspect of packaging. In Australia there are 42 classes in which a trade mark can be registered and there is no limit on the number of classes in which an application can be made. say) in other countries need to register them in those other countries. numeral. A registered owner of a trade mark has: the exclusive rights: (i) to use the trade mark.5 A person may apply for the registration if ‘the person claims to be the owner of the trade mark’ and ‘the person is using or intends to use the trade mark’. ticket. the trade mark may be retained indefinitely.

and (d) for that reason. However. and they may be protected by provisions of the Trade Practices Act 1974 (Cth). or deceptively similar to. or deceptively similar to that of the trade mark. the sign would be likely to be taken as indicating a connection between the unrelated goods or services and the registered owner of the trade mark. infringement occurs where a sign with respect to goods or services is substantially identical with. the trade mark in relation to: (a) goods of the same description as that of goods (registered goods) in respect of which the trade mark is registered. Nevertheless. the interests of the registered owner are likely to be adversely affected. the states’ and the ACT’s Fair Trading Acts and the tort of passing off. Infringement Section 120 of the Act details circumstances where a registered trade mark is infringed. or (b) services that are closely related to registered goods. the trade mark in relation to: (i) goods (unrelated goods) that are not of the same description as that of the goods in respect of which the trade mark is registered (registered goods) or are not closely related to services in respect of which the trade mark is registered (registered services). or deceptively similar to. the trade mark in relation to goods or services in respect of which the trade mark is registered. business and company names become valuable identifiers. (3) A person infringes a registered trade mark if: (a) the trade mark is well known in Australia. In essence. or deceptively similar to. and (c) because the trade mark is well known. a defence to an action of infringement of a registered trade mark. (2) A person infringes a registered trade mark if the person uses as a trade mark a sign that is substantially identical with. or (ii) services (unrelated services) that are not of the same description as that of the registered services or are not closely related to registered goods. or (d) goods that are closely related to registered services. .112 LAW OF ELECTRONIC COMMERCE Registration of a business name or a company name is not. or (c) services of the same description as that of services (registered services) in respect of which the trade mark is registered. the person is not taken to have infringed the trade mark if the person establishes that using the sign as the person did is not likely to deceive or cause confusion. Establishing that the use is not likely to deceive or cause confusion constitutes a defence to an infringement charge: 120(1) A person infringes a registered trade mark if the person uses as a trade mark a sign that is substantially identical with. and (b) the person uses as a trade mark a sign that is substantially identical with. in itself.

which allows users to connect to vast quantities of information. if that is dependent on ‘hits’ on the home page. if they are the same. 8 Trade Marks Act 1995 (Cth) s10. the effect may be to reduce the site’s advertising revenue. Inc. Unfair Competition. respectively. ‘Deep linking. citing Restatement Third.9 Hyperlinking Hyperlinks are fundamental to internet use and navigation. For example. Berlei Hestia Industries Ltd v Bali Co. See Koninklijke Philips Electronics NV v Remington Products Australia Pty Ltd (2000) 100 FCR 90. §25.10 The value of the World Wide Web lay in the process of hyperlinking.12 The linking process can be regarded as a ‘use’ of such a mark in contravention of section 120(1) and (2). . paras 42–43. Polaroid Corp. goods or services are similar to other goods or services. whether a trade mark is well known in Australia . PATENTS AND CIRCUIT LAYOUTS 113 (4) In deciding. Secondly. what is protected is “the commercial value or ‘selling power’ of a mark by prohibiting uses that dilute the distinctiveness of the mark or tarnish the associations evoked by the mark”’. text. The courts have held that this ‘dilution theory of liability “does not require proof of a likelihood of confusion”. rather.7 A trade mark is taken to be deceptively similar to another trade mark if it so nearly resembles that other trade mark that it is likely to deceive or cause confusion. (2004) MurUEJL 2.) Ltd (1963) 109 CLR 407. However. or if they are of the same description as that of the other goods or services.11 Trade mark infringement can arise where one website links to another with registered trade marks. 9 Campomar Sociedad Limitada v Nike International Limited [2000] HCA 12. 10 On hyperlinking generally. one must take account of the extent to which the trade mark is known within the relevant sector of the public. v Sole N Pty Ltd [1981] 1 NSWLR 491. Bruno de Vuyst and Gunther Meyer. whether as a result of the promotion of the trade mark or for any other reason. Transport Tyre Sales Pty Ltd v Montana Tyres Rims and Tubes Pty Ltd (1999) 93 FCR 421. the use of a deep link may give the impression that there is a connection. graphics and data with a simple mouse click. Whatever the intention. of Australia Ltd v Esso Standard Oil (Aust.TRADE MARKS. see Chapter 6. Revenue is typically tied to the number of hits or depends upon actual use of the advertising links. Comment (a). framing. websites can also be designed in a way that may be prejudicial to trade mark rights and copyright of others. 12 Ibid. 11 See Katia Bodard. (1973) 129 CLR 353. For the purposes of the Act. for the purposes of paragraph (3)(a). inlining and extension of copyrights: Recent cases in common law jurisdictions’. users who link directly to targeted pages within a particular website bypass the home page. Shell Co.8 Sections 120(3) and (4) have extended the infringement action to restrain activities which are likely to adversely affect the interests of the owner of a famous or well-known trade mark by the ‘dilution’ of its distinctive qualities or of its value to the owner. This form of hyperlinking is referred to as deep linking. affiliation or some relationship between 7 Trade Marks Act 1995 (Cth) s14.

the applicant14 ran the Shetland Times and a website. The hyperlinks pointed directly to articles on the applicant’s website. 97 Civ.114 LAW OF ELECTRONIC COMMERCE the owners of the two sites. no substance. Described in the judgment as ‘the pursuers’.15 The court issued an ‘interim interdict’ requiring the defendants to remove the links. but it demonstrates the commercial concerns involved. This impression may deceive or cause confusion to a user. Many would argue that freedom of access and use was an inherent feature of the World Wide Web. To succeed in an action. Ticketmaster argued that a formal licence agreement would be required before anyone could link to its site. . such problems have been resolved by 13 14 15 16 17 [1997] 37 IPR 71. Since these early cases. The defendant created hyperlinks using the headlines from the applicant’s newspaper. The appearance gave some users the impression that the articles were part of the defendant’s website. [1997] 37 IPR 71. a competitor of Microsoft’s Sidewalk site. and the case did not proceed to a full hearing where argument could be made in full. [1997] FSR 604. The matter was subsequently settled. Ticketmaster entered into an agreement with CitySearch. Ticketmaster had been negotiating such a licence with Microsoft. Instead. It further asserted that by placing a website online web hosts impliedly consented to links. committing electronic piracy’. an aggrieved party must show deception or confusion. No. . particularly for websites placed in the public domain and intended to be readily accessed by the public. his Lordship considered: ‘there is a clear prospect of loss of potential advertising revenue in the foreseeable future’.13 before Lord Justice Hamilton in 1996. 97-3055 DDP (CD Cal 1997). on its Seattle Sidewalk entertainment site. 1190 (PKL) (SD NY). diluting the value of the trade mark and damaging its relationship with sponsors. in the suggestion that the pursuers were gaining an advantage by their newspaper items being made available more readily through the defenders’ website’.16 Microsoft provided a link. including deep links. Unfortunately the judgment was given at a preliminary stage. in my view. Microsoft claimed that the use of links is fundamental to the operation of the web and relied on the US constitution’s protection of free speech and the fair use doctrine. Ticketmaster claimed that Microsoft misused Ticketmaster’s name and trade mark.17 Implementing a hyperlink in itself should not be regarded as a trade mark infringement. to the Ticketmaster home page. The first such case before the courts was the Scottish case Shetland Times Ltd v Wills and Zetnews Ltd. [1997] FSR 604. The concept of property in a link was unknown to the legal and internet community. See also The Washington Post Company v Total News Inc. para 22. The defendant ran the newspaper the Shetland News and a corresponding website. Ticketmaster claimed that Microsoft was ‘feathering its own nest at Ticketmaster’s expense . Because the links bypassed the applicant’s home page. Additionally his Lordship stated that ‘[t]here was. This case was settled out of court. . in the circumstances. In Ticketmaster Corporation v Microsoft Corporation. but negotiations had broken down.

The web designer may create a heading or menu along the top of the page or on the left or right margin. if links are used in a manner which causes deception or confusion. The preamble provides that the rationale for the directive is that databases ‘are not at present sufficiently protected by Member States’ and ‘such differences in the legal protection of databases offered by the legislation of the Member States have direct negative effects on the functioning of the internal market as regards databases’. and of course make available the advertising previously bypassed. Framing Web pages may be displayed in sections called frames. 9733/2005. In Europe. remedies may be available under the copyright legislation.ivir. in response to concerns that information is inadequately protected by the law. so that the user can only access such pages from the home page. 20 (2005) IA no. . In addition. with use that is likely to injure the reputation of the trade mark. 19 District Court (Arrondissementsrechtbank) Arnhem. 2006. PATENTS AND CIRCUIT LAYOUTS 115 technology. Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases was passed. In Bixee v Naukri. This heading or menu remains static while the body of the web page changes 18 See Bernstein v JC Penny Inc. This directive concerns the legal protection of databases in any form. 21 See Chapter 6.com from deep linking to Naukri. ss52 and 53.pdf. section 121(2) provides that it is a prohibited act to apply or use a trade mark in an altered manner or in relation to registered goods. If no trade mark is involved.com.nl/files/database/ sources/HofZAH. reported as India’s first deep linking case. the aggrieved party may seek redress through section 120 of the Trade Marks Act (Cth).20 the Delhi High Court in India prohibited Bixee.18 In Zoekallehuizen.21 the Trade Practices Act 1974 (Cth) Part V. available at www. The structure and design of the home page can be such as to reveal the correct authorship. minimise confusion. Web designers can restrict access to ‘deep linked’ pages. In Australia. 50 USPQ 2d 1063 (CD Cal 1998).22 the corresponding provisions of the state and territory Fair Trading Acts and the tort of passing off. and a trade mark is involved.TRADE MARKS. 22 In particular.nl v NVM19 the respondent operated a specialist search engine that searched for houses for sale and placed links to such information on the websites of local real estate agents. The preliminary injunction was issued on a prima facie finding that Naukri suffered significant financial loss due to the diversion of readers away from the advertisements. The applicants were the Dutch Association of Real Estate Agents and two local real estate agents. The President of the District Court of Arnhem rejected the claim for a restraining order stating that the websites of the real estate agents did not show substantial investment and were therefore not protected.

23 24 25 26 97 Civ 1190 (SD NY 1997). Lexis 2265 (9th Cir 1998). 1998 US Dist. 97 Civ 1190 (SD NY 1997). trademark dilution and infringement. Other frames contained information on its business operations. The plaintiff’s cause of action was based on copyright infringement and unfair competition. The advertisements from the external sites were reduced in size or obscured. This decision was affirmed on appeal.116 LAW OF ELECTRONIC COMMERCE when links.. v Total News23 the defendant used framing to present the content of external news sites such as CNN. are selected. Users may well think that the outside contents are part of the framer’s web page. the case accepted that framing in appropriate circumstances could be the basis for an infringement claim. just as that conduct would not be tolerated in the world of print and broadcasting it is equally unlawful in the world of cyberspace. Preliminary Statement (emphasis added). This permits navigation within a website. but the body of the web page displayed is in fact from another source. hypertext mark-up language (HTML) permits any web page to be displayed within any frame. The plaintiffs claimed: Simply put. the reason for this refusal was that the plaintiff failed to prove that any harm had resulted from the conduct of the defendant. However. Problems arise where the static heading or menu continues.26 another US case.25 The dispute was settled on terms that included permitting Total News to continue linking to the plaintiff’s website. In Washington Post Co. 97 Civ 1190 (SD NY 1997). However. not the site that is actually being displayed in the body of the page. Times Mirror. v Applied Anagramatics Inc. Such unauthorised framing can be misleading and deceptive and can amount to infringement of trade mark. packaging those stories to advertisers as part of a competitive publication or program produced by the Defendants and pocketing the advertising revenue generated by the unauthorized use of that material . including within the body of the original site. . and other related tortious acts all committed by Defendants in connection with their operation of a parasitic site known as ‘totalnews. Dow Jones and Reuters. The court refused to grant an interim injunction.com’ on that portion of the Internet known as the World Wide Web. wilful copyright violations. Total News could not use the framing technique. framing was used with respect to referrals to dental websites. The frame was one of several on the defendant’s website. CV 97–6991 ABC (Manx). Defendants are engaged in the Internet equivalent of pirating copyright material from a variety of famous newspapers. magazines or television news programs. internal or external. . Indeed the displayed URL in the web browser may indicate the framed website. In Futuredontics Inc. However. . Nevertheless.24 In their written preliminary statement to the court. The Washington Post had this to say about linking without permission: This action arises out of blatant acts of misappropriation.

31 Playboy Enterprises Inc. Even though the code is hidden from view. One important criterion involves the words and phrases used.27 There are many types of meta-tags. their frequency and location. 3d 1169 (9th Cir 1998). or merely to interfere with the search engine research for another site. The ‘keyword meta-tag’ was designed to assist search engines. 28 [1999] ATMO 68. The 9th Circuit court in the United States described the use in this manner: The meta tags are not visible to the websurfer although some search engines rely on these tags to help websurfers find certain websites. Meta-tags are not displayed on the website. these tags are invisible to the person trying to locate the cheese but will bring the merchant’s homepage up on the search. Thus a cheese-vendor on the Internet might include the various trade marks or generic names of cheeses as meta-tags on his homepage: these words are found by the search engines used by the public. One significant factor in allocating a score is the use of words in the keyword meta-tag. Much like the subject index of a card catalog. the meta tags give the websurfer using a search engine a clearer indication of the content of a website. v Hie Holdings Pty Ltd28 the Registrar of the Australian Trade Marks Office described a meta-tag in these terms: [M]eta-tags are words embedded in the code for homepages on the Internet .TRADE MARKS. The purpose may be to deflect patronage from a competitor. 30 For example ss52 and 53. for a law firm: <meta name=‘keywords’ content=‘law legal resource solicitor lawyer securities litigation intellectual property patent trade marks trade secret copyright software computer technology mediation confidential information australia’>. In Playboy Enterprises Inc. For example. The information may be misleading and deceptive. PATENTS AND CIRCUIT LAYOUTS 117 Meta-tags Meta-tags are pieces of information in the source code of a website. .30 Trade mark infringement becomes a factor where the website designer uses another’s trade mark in the meta-tag. the designer may insert ‘best’ or ‘top ten’ before other keywords describing the product or service.31 27 For example the following code may be inserted in the ‘head’ section of the website’s code. dealing with deceptive and misleading conduct. A score is given and search results list the results with the highest scores first. . . It is common for traders to embed meta-tags in their homepages so that those who are searching on the Internet find those pages via the meta-tags which are located by the search engine that the searcher is using. such a misuse can amount to an infringement. Such a manipulation may be a breach of the Trade Practices Act 1974 (Cth).29 Some website authors have misused the meta-tags. but can be viewed by selecting the ‘source’ view. 29 In this case the ATMO refused to the application to register ‘Playbabe’ on the basis of its similarity to the Playboy trade marks. Such a tactic increases that website’s search engine score for searches that include the word ‘best’. The website designer inserts keywords into the meta-tag to indicate the purpose of the website and to assist search engines. v Welles 162 F. Search engines are based on algorithms designed to produce valuable and meaningful results for the user. Thus.

com) in any ‘machinereadable code’. Supp. Insituform Technologies Inc. 33 985 F. contravening of section 52 of the Trade Practices Act 1974 (Cth). . 1) [2006] FCA 518. v Welles34 the defendant had been a Playboy playmate of the year. Supp. v Calvin Designer Label32 the court granted an injunction to restrain the use of Playboy’s trade mark in the defendant’s domain names (playboyxxx. 3d 1169 (9th Cir 1998).33 In Playboy Enterprises Inc. The 9th Circuit court stated that the defendant ‘used the terms “Playboy” and “Playmate” as meta tags for her site so that those using search engines on the Web can find her website if they were looking for a Playboy Playmate’. Although not applied in Australian case law to date. in Defendants’ use of the domain names . 97–2064 (ED La 1997) and the German Federal Supreme Court judgment May 2006 I ZR 183/03. also known as Swami Anandakapila Saraswati. para 6. After a falling out between the parties Mumford demanded the removal of meta-tags which included his names and the cancellation of the registration of certain domain names. so that the PLAYBOY trademark is accessible to individuals or Internet search engines which attempt to access Plaintiff under Plaintiff’s PLAYBOY registered trademark. 2d 1220 (ND Cal 1997). and the repeated use of the PLAYBOY trademark in machine readable code in Defendants’ Internet Web pages.com and playmatelive.118 LAW OF ELECTRONIC COMMERCE In the US case of Playboy Enterprises Inc. including a false designation of origin and false representation. the defendant’s use in this instance was regarded as fair use. v National Envirotech Group (1997) Civil Action No. 2d 1220 (ND Cal 1997). and in meta-tags: The Court finds that Plaintiff PEI is likely to succeed on the merits in proving inter alia trademark infringement. He entered into an agreement to permit his names and reputation to be associated with the promotion of several websites. However. Notwithstanding the prior authorisation and agreement the Federal Court held that such conduct was misleading and deceptive. Mumford’s name was in the source code. section 146 of the Trade Marks Act 1995 (Cth) is also well suited for a imposing a sanction against the misuse of a trade mark in a meta-tag: 32 985 F. . 34 162 F. Athens v Randwick City Council [2005] NSWCA 317. as a meta-tag and on 44 web pages of the defendant.35 In Kailash Center for Personal Development Inc. and used the playboy trade marks on her website. as the expressions ‘playboy’ and ‘playmate’ may be used and were used appropriately in an editorial fashion. unfair competition. . 35 See also Natural Floor Covering Centre Pty Ltd v Monamy (No. Allsop J regarded the use of Mumford’s name and pseudonyms as a misappropriation and ordered the discontinuance of such use. The court held that misuse of the trade mark in a meta-tag can be an infringement. 36 [2003] FCA 536. v Yoga Magik Pty Limited36 Jonn Mumford. including in her site’s meta-tags. had developed a reputation with regard to yoga and Eastern spirituality.

38 Developments in the United States For many years. 39 149 F. generally. Businesses have relied upon the application of copyright law to protect computer programs and other software-related intellectual property.ipaustralia. data compression schemes. a composition. methods of doing business were not patentable. 38 For the New Zealand equivalent see the Patents Act 1953 (NZ). or are to be. and (b) without being required or authorised to do so by this Act.au/patents/. a living organism.gov. nonobvious and useful. 47 USPQ 2d (Fed Cir 1998). . dealt with or provided in the course of trade. insurance and finance. Patents evolved from mere legal instruments protecting intellectual property into valuable corporate assets and competitive commercial weapons. dealt with or provided in the course of trade.37 A patent will be granted to protect any novel and non-obvious technological development. a direction of the Registrar or an order of a court. or are to be. businesses are now more likely to choose patent protection as their most powerful offensive and defensive weapon in protecting intellectual capital on the internet.39 The court held that ‘methods of doing business’ are patentable and legitimate. of the trade mark. In the United States. a method or a process. knowing that the trade mark is registered or reckless of whether or not the trade mark is registered. there has been a deluge of applications for cyberpatents as a result of the 1998 decision in State Street Bank and Trust Co. a substance. The decision applies to electronic commerce. However. or (b) falsely applies a registered trade mark in relation to goods or services that are being. Recent amendments to the Patents Act 1990 (Cth) have included patent protection for business processes and other technology. PATENTS AND CIRCUIT LAYOUTS 119 Falsely applying a registered trade mark 146(1) A person is guilty of an offence if the person: (a) falsely applies a registered trade mark to goods that are being.TRADE MARKS. banking. v Signature Financial Group Inc. The US Patent Act requires that patentable inventions must be new. Patents for software and internet processes A patent provides protection for inventions. provided that the other statutory criteria are met. or of an authorised user. Potentially patentable internet inventions since the State Street decision include communications protocols. 3d 1368. internet technology. or in relation to goods or services if the person applies the trade mark or a sign substantially identical with it to the goods or in relation to the goods or services: (a) without the permission of the registered owner. The invention may be a device. www. (2) A person falsely applies a registered trade mark to goods. 37 See.

a presumption of obviousness applies and the invention is not patentable. presentation of information and programs for computers. This was contingent upon the program being able to produce a ‘technical effect’ (that is. The UK Patents Act has identical provisions to the EPC. Developments in Australia In Australia. The Act also reduces the burden of proof for challenges to the validity of a patent. allowing the public the opportunity to present information about prior inventions or request a hearing to determine whether an invention was known. However. decisions of the Board of Appeal of the European Patent Office have allowed patents for computer programs. Where the business method invention is merely a computer implementation of an existing practice. or was in public use. novel. in Merrill Lynch’s Application. hardware. Business method patent applications are to be published for 18 months. A revised version has been in operation from December 2007. 40 HR 5364. something beyond normal physical interactions between software and hardware) when the hardware executes the program’s instructions.42 the UK Court of Appeal held that a computerised trading system for stocks and shares was capable of being patented. However. The Act aims to provide a speedy and less costly alternative to litigation. section 18 of the Patents Act 1990 (Cth) provides that a patentable invention must be a manner of manufacture. computer software (including servers. mathematical methods. the US Business Method Patent Improvement Act40 was passed by Congress in 2001. involve an inventive step. browsers and search engines).120 LAW OF ELECTRONIC COMMERCE encryption and security procedures. . but Article 52(2) expressly excludes methods of doing business. Developments in Europe Article 52(1) of the European Patent Convention (EPC) provides that European patents may only be granted for inventions susceptible of industrial application which are new and which involve an inventive step. These decisions bring the European Union’s position on the patentability of internet and other software-related inventions closer to that of the United States. user interfaces and methods of conducting business online. In response to the dramatic increase of applications for cyberpatents. 41 The EPC originally came into force in 1973.41 The term ‘invention’ is not defined in the EPC. This confirmed that inventions whose novelty and non-obviousness reside in unpatentable subject matter such as computer programs are still capable of being patented. The Act was intended to regulate business method patents and the conditions of issue and to make sure that the Patent Office issued these patents only where the method was new and innovative. Japan and Australia. 42 [1989] RPC 561. used by others.

The Full Federal Court distinguished ‘manner of manufacture’ from novelty and inventive step in section 18 of the Patents Act. . The Australian Patent Office (APO) followed the United States in rejecting patent applications for software-related inventions because they were not a ‘manner of manufacture’ within the meaning of the Act.43 Software-associated inventions were unpatentable because they were perceived as schemes for operating a known machine.48 It was held that while the mathematics of the invention was not new. 45 (1991) 22 IPR 417. (2001) 21 Proctor 1. The court considered an algorithm to be ‘a procedure for solving a given type of mathematical problem’.47 the Federal Court determined the ‘manner of manufacture’ test to be whether the invention ‘belongs to a useful art as distinct from a fine art . Although the majority of users of the petty patent system were small to medium sized enterprises (SMEs). Further. PATENTS AND CIRCUIT LAYOUTS 121 be useful and not secretly used before the priority date of a patent claim. 51 (1994) 27 IPR 481 at 514. Patentable inventions must demonstrate an ‘innovative step’ when compared to the prior art base. not a ‘manner of manufacture’. its application to computers was commercially useful in the field of computer graphics: IBM was successful. The petty patent system was designed to provide a form of protection that was quick and easy to obtain. At issue was the validity of a ‘petty patent’50 relating to the input of Chinese characters into a word processing system. and confirmed the NRDC ‘manner of manufacture’ test. 33. ‘Review of the innovation patent issues paper’. v Commissioner of Patents (NRDC). .46 In applying the High Court decision of National Research Development Corp. Ltd’s Application (1968) 38 AOJP 1020. 48 (1991) 22 IPR 417 at 423. . was relatively inexpensive and provided short term protection especially for inventions that had a short commercial life. the court held that the invention was useful in the economic endeavour of using word processing to assemble text in Chinese language characters.51 In recognition that patents for business processes and other technology should be protected.44 IBM Corporation v Commissioner of Patents45 concerned a ‘method and apparatus for generating curves on computer graphics displays’. CCOM Pty Ltd v Jiejing Pty Ltd49 followed the IBM decision. ‘Patents for software and computers processes’. the Patents Act was amended in 2000 to significantly lower the inventive threshold. 47 (1959) 102 CLR 252. the system had limited success in meeting its intended objectives’: Australian Government/IP Australia. or intellectual processes or algorithms. 50 ‘The innovation patent was introduced in 2001 following an Advisory Council on Intellectual Property (ACIP) review of the petty patent system. 44 See Alan Davidson. 49 (1994) 27 IPR 481. 46 (1991) 22 IPR 417 at 419.TRADE MARKS. One objection by the Commissioner of Patents was that it was a mathematical algorithm. or abstract ideas. that its value to the country is in the field of economic endeavour’. An innovative step involves a variance from the prior state of knowledge in a way which is meaningful in terms 43 See British Petroleum Co. September 2005. rather than the current ‘inventive step’ and be ‘obvious to a skilled person in the relevant field’.

Australia regards software-related internet inventions in much the same way as other software-related inventions. concrete and tangible result’. in the field of economic endeavour .55 In this case. comprising the following steps: (a) (b) (c) (d) establishing a trust [and] having a trustee. . . The original law was the Imperial Statute of Monopolies 1623 (UK). 55 [2005] FCA 1100. the invention the subject of the Patent is not a proper subject of letters patent according to the principles which have been developed for the application of s6 of the Statute of Monopolies. the trustee making a loan of said sum of money from the trust to the owner. 53 [2005] FCA 1100. The performance of the invention will not add to the economic wealth of Australia or otherwise benefit Australian society as a whole. Explanatory Memorandum. Her Honour found that the trust structure proposal lacked the appropriate: value to the country . The amendment is intended to include cheese and wine making. and have formulated similar tests for determining patentable subject matter.56 Australian developments in software-related patents have paralleled those of the United States. which requires a ‘technically useful’ effect. which raised a test of ‘a useful. For this reason. The criteria are typically novelty and inventiveness.54 Justice Branson stated that ‘an invention should only enjoy the protection of a patent if the social cost of the resulting restrictions upon the use of the invention is counterbalanced by resulting social benefits’. 56 See also State Street v Signature 149 F. and the trustee securing the loan by taking a charge for said sum of money over the asset. This approach is in line with the European approach. its section 6 is the equivalent of Patents Act 1990 (Cth) s18(1A). . Many Australian internet patents mirror US patents through the medium of the Patent Co-operation Treaty. the owner making a gift of a sum of money to the trust. the patent applicant was required to demonstrate that the performance of the invention ‘adds to the economic wealth of Australia or otherwise benefits Australian society as a whole’ and ‘advances the public interest’.53 Justice Branson of the Federal Court considered the validity of a business method-type patent. Provided the invention works in an 52 See the Patents Amendment (Innovation Patents) Bill 2000. 3d 1368 (1998). brewing and certain industrial processes as patentable inventions. paras 20–21. para 2. Patents and hardware Electronic hardware is most suitable for patent application. Both nations consider software inventions as patentable. in my view. .122 LAW OF ELECTRONIC COMMERCE of how the invention actually works. 54 [2005] FCA 1100. The claim related to a method for protecting an asset. . This may be of particular concern for foreign applicants.52 In Grant v Commissioner of Patents.

Circuit layout rights A circuit layout is a two-dimensional representation of a three-dimensional integrated circuit (these are also referred to as computer chip designs or semiconductor chips). For the New Zealand equivalent see the Layout Designs Act 1994 (NZ). such as computers and medical devices like pacemakers. to give the owner rights. .57 Circuit layouts are highly complex and the intellectual input required to create them may be of significant value. Like copyright. Integrated circuits are an integral part of modern electronics.62 The rights include 57 58 59 60 61 62 Circuit Layouts Act 1989 (Cth) s5.html. directly or indirectly.58 The purpose of the Act is to protect the intellectual property component of circuit layouts and integrated circuits. in a material form. there is no requirement for registration for the granting of rights to owners. or was commonplace at the time it was made. a three-dimensional copy of the layout). The Act became operative in 1990. especially the right to make an integrated circuit from the plans. the patent application will be granted. Circuit Layouts Act 1989 (Cth) s11. Integrated circuits and circuit layouts are both protected under the Circuit Layouts Act 1989 (Cth). PATENTS AND CIRCUIT LAYOUTS 123 improved manner over previously known devices. Circuit Layouts Act 1989 (Cth) s5. computer components and accessories. and to exploit the layout commercially in Australia.TRADE MARKS.wipo. to make an integrated circuit in accordance with the layout (that is. or first commercially exploited in Australia. Available at www. It is part of Australia’s obligation under GATT (the General Agreement on Tariffs and Trade). Examples include computer systems. The Act excludes layouts where the making involved no creative contribution by the maker. Member nations of the World Trade Organization Agreement are required by the Agreement on TradeRelated Aspects of Intellectual Property Rights (TRIPS) to protect circuit layout designs in accordance with the Treaty on Intellectual Property in Respect of Integrated Circuits adopted at Washington DC in 1989. The Act assists in preventing billions of dollars being lost from unauthorised replication and distribution.60 A layout originating in a country formally declared in the Circuit Layout Regulations will also be given protection by the Act.int/treaties/en/ip/washington/trtdocs_wo011.59 The Act protects original circuit layouts made by an Australian citizen or an Australian corporation. Circuit Layouts Act 1989 (Cth) s17.61 The Act grants the owner of an original circuit layout rights to copy the layout. See definition of ‘eligible layout’.

Mozambique. Colombia. New Zealand. Chile. Mali. Central African Republic. Slovenia. 22. Senegal. Mauritania. India. Tunisia. Cyprus.66 Where there is a flagrant infringement or the infringer has gained some benefit. Lesotho. Dominica. Bangladesh. The owners of such must resort to the law of copyright and designs protection. Belgium. Bahrain. Malta. Jamaica. Circuit layout designs made before 1 October 1990 are not protected by the Circuit Layouts Act 1989 (Cth). sale. Singapore. 69 The listed countries are: Antigua and Barbuda. Romania. Where another person commercially exploits a layout. Trinidad and Tobago. 64 Circuit Layouts Act 1989 (Cth) ss21(1). Luxembourg. where copying is for research or teaching purposes. an account of profits or ‘additional damages’. Burundi. Myanmar. Cote d’Ivoire.65 This can result in a maximum period of 20 years.124 LAW OF ELECTRONIC COMMERCE commercial exploitation. Costa Rica. Ireland. Pakistan. France. 65 Circuit Layouts Act 1989 (Cth) s5.69 63 Circuit Layouts Act 1989 (Cth) s19(3). hire and distribution. Saint Lucia. . 66 Circuit Layouts Act 1989 (Cth) s27(1) and (2). the protection period runs for 10 years after the calendar year in which the layout was made. Iceland. Barbados. Italy. a court has discretion to award additional damages. Mexico. Mauritius. Egypt. Japan. Gabon. Brazil. Paraguay. Philippines. Morocco. where copying in the process of evaluation or analysis of a layout or where the uses of layouts are for Commonwealth defence or security. United Kingdom. Indonesia. if the person knew or ought reasonably to have known that they did not have licence to do so. Djibouti. Malawi. Poland. Republic of. 3. Cuba. Korea. Slovak Republic. Uganda. Ghana. Sierra Leone. Portugal. Denmark. Tanzania. South Africa. The holder of the rights may take civil action for infringement: possible remedies are an injunction. Liechtenstein. Nicaragua. Belize.67 Action must be commenced within six years of the alleged infringement. Nigeria. Swaziland. Czech Republic. Bolivia. Guatemala. Kenya. 23 and 25 respectively. United States of America. Hungary. Botswana. 68 Required by the TRIPS Agreement. Netherlands (for the Kingdom in Europe and the Netherlands Antilles). Guinea. Finland. Norway. such as import and export. If the layout is first commercially exploited within 10 calendar years after it was made the protection period runs until the end of the 10th year after the calendar year in which the layout was first commercially exploited. Maldives. Guyana.68 Layouts made or originating outside Australia in listed countries are given the same level and kind of protection in Australia as layouts made in Australia. Peru. Malaysia. Guinea Bissau. Namibia. Art. Germany. Israel.64 If the layout is not commercially exploited. Canada. Switzerland. Togo. the rights of the owner will have been infringed. Austria. Greece. Member nations of the WTO Agreement must protect circuit layouts and give the same level of protection to foreigners who make or exploit circuit layouts in their country as they do to their own citizens. Saint Vincent and the Grenadines. El Salvador. Venezuela. Thailand. Macau. 67 Circuit Layouts Act 1989 (Cth) s27(4). Argentina. Zambia and Zimbabwe. Turkey. Sri Lanka. Uruguay. Suriname. damages. Sweden.63 The holder’s rights are not infringed where a person copies the layout for his or her private use. Kuwait. Burkino Faso. Brunei Darussalam. Spain. Dominican Republic. Honduras. Hong Kong.

Bruno de Vuyst and Gunther Meyer. inlining and extension of copyrights: Recent cases in common law jurisdictions’.ipaustralia.TRADE MARKS. WIPO Treaties: www. IP Australia (Trade marks): www.au/patents/. PATENTS AND CIRCUIT LAYOUTS 125 Further reading Katia Bodard.int/treaties/en/.wipo. framing.ipaustralia.gov.gov. (2004) MurUEJL 2. .au/trademarks/. IP Australia (Patents): www. ‘Deep linking.

twisting and changing continuously. More than a billion users1 trawl unreal space for the gold. a 30-fold increase in 10 years – www. The use and misuse of domain names have raised conflicts previously unknown in law. Others are hidden and security protected. Cyberspace contains a massive amount of valuable and useless information. yet existing laws are territorially based. The domain name system forms a map in cyberspace. Some are freely available and easy to locate.internetworldstats. Existing legal remedies have proven inadequate. The internet recognises no boundaries. Their value in terms of both knowledge and commercial interests is unprecedented. Domain names permit millions of possibilities for cataloguing. There are several billion web pages at users’ disposal.8 Domain names Mapping cyberspace Cyberspace is chaos. structure and regulations. property rights. It is metamorphic in nature. titbits and junk released by a multitude of undisciplined hosts. A semblance of order emerges in part by using meaningful identifiers for human interaction. indexing and listing material. This chapter examines the nature of domain names. Compulsory arbitration clauses have been placed into domain name licence agreements 1 Internet World Stats reports that internet users passed the one billion mark (approximately 16 per cent of the world’s population) in 2005. 126 . Chapters 9 and 10 deal with domain name disputes and their resolution through the courts and through the use of domain name dispute resolution policies. Information in cyberspace is so vast it cannot be properly catalogued. and often they have been unenforceable. growing. Domain names have unwittingly become significant business identifiers and valuable assets. indexing and searching.com. expensive and inconvenient.

and ultimately into the internet. e e European Laboratory for Particle Physics). The problem of duplication is partly resolved by the use of country codes and various generic top-level domain name suffixes. The ICANN and domain administrators’ ‘first come first served’ approach has proven unfair and inappropriate in many circumstances. computer networking and hypertext into an information system. Courts and legislatures have had to be flexible and innovative in their approach to providing remedies in relation to domain name rights. 2001. Hockessin DE. In a short time internet administration was transferred to the Internet Corporation for Assigned Names and Numbers (ICANN). Some domain names are bought and sold like property. Tim Berners-Lee and the development of the World Wide Web (Unlocking the secrets of science). subject to network connections. others see them as having the characteristics of mere licence rights. This system became operative within CERN. The underlying principle was to merge the technologies of personal computers. This would be modest at first. The initial purpose was to communicate among colleagues and access large quantities of data. domain names are systemically international. Tim Berners-Lee is regarded by many as the inventor of the internet. there are occasionally new situations which the general law has been unable to predict and. resulting in inconsistent determinations. . 2 See Ann Gaines. During 1990 and 1991 Berners-Lee developed the underpinnings of the system. initially at least. It is common to see identical or similar business names and identifiers in different geographic locations. The laws and regulations regarding domain names and their use are as new as the internet.DOMAIN NAMES 127 in an attempt to address these deficiencies. Business identifiers Electronic commerce technologies have advanced with such momentum that designers have taken little time to consider their legal implications. But new problems continue to arise. Their foundation and understanding test jurisprudential norms in the true sense. then expanded into physics research and hypertext programming communities. Domain name conflicts and rights cannot be satisfactorily pigeonholed with other legal precepts. The majority of businesses operate within a suburb. Some people regard domain names as a new form of intellectual property. he invented the World Wide Web. While the majority of electronic commercial situations can be resolved using existing legal principles. However. but it had the potential to be worldwide. as a scientist at CERN (Centre Europ´an pour la Recherche Nucl´aire. is unable to cope with. Mitchell Lane Publishers.2 In 1989. The use of similar or identical standard business identifiers in different geographical locations may never give rise to disputes or be of concern.

login.4 The nature of domain names Each internet page has a unique address. state or country. IPv6 has a larger address space 3 For more.296 – unique IP addresses.html. passing off or misrepresentation. There may be a number of directories or none at all (in the latter case. 3. See also Chapter 7.967. But there can only be one smith. query. Protocol: Domain name: Directory(ies) (path): File: http www. host. the protocol. files are on the root directory). The current version is IPv4.128 LAW OF ELECTRONIC COMMERCE city. Most jurisdictions have enacted rules in relation to registering business names and company names. Files are typically in hypertext markup language (html) but may be any type of file. a default file will apply. referred to as a Uniform Resource Locator (URL). IPv6 is planned to replace IPv4. Further. path.com. 4 For more on misrepresentation and passing off in a domain name context see supra. This permits 232 – or 4. Underlying domain names is a numeric Internet Protocol (IP) address. Protocols exist for various parts of each URL. Each URL can have a number of parts: for example.edu. the laws of passing off and misrepresentation usually protect the use of a name within a specific geographic area.int/about-ip/en/trademarks. but internet users are most familiar with Hypertext Transfer Protocol (http). . Here is a typical URL with an html file: http://www. anchor/fragment. Individuals have the right to use their own name. Smith Dry Cleaning may conflict with all international ‘Smith’ businesses: Smith Motors.14. file. ‘Smith Dry Cleaning’ could be registered in every major city without any concern regarding misleading or deceptive conduct.html There are a range of possible protocols. see the WIPO home page and www. spending considerable time and money on research and marketing to make a selection which will reflect the nature of the business and yield the greatest profits.uq.294. Commercial entities place great importance on their trade name.au/davidson/index. A trade mark is a distinctive sign which identifies certain goods or services as those produced or provided by a specific person or enterprise.151.89. Smith Music and so forth. Domain names are centrally organised and registered and must be unique.uq. Where there is no file specified. Trade mark legislation usually includes provisions from international conventions and agreements to assist in standardising the global position. The IPv4 means that every individual domain name is in fact a 32 bit number made up of four sets of numbers joined by dots: for example.wipo.html. edu. port. the fourth iteration.3 In the absence of trade mark registration.au davidson index.

DOMAIN NAMES 129 to permit greater flexibility in allocating addresses and in routing traffic.uk for the United Kingdom. Each domain name must be unique so that when the user types in a particular address the system will only point to one source.asia (for the Pan-Asia and Asia Pacific community) .us has now been added to the list.in for India and . this disadvantaged US users as many domain names without a ccTLD were registered internationally. .biz (business) .org (miscellaneous organisations) 5 The list of country codes is available at www.org/cctld/cctld-whois. The domain name has prescribed protocols which expand and evolve according to demand and usage. third and fourth level domain name. In the example above it is ‘uq’. There are some 240 ccTLDs.htm. In addition the protocols may involve the top level domain name and second. country code domains were created to be used by individual countries. Initially the United States did not have an assigned ccTLD and users simply omitted the code. Generic domains were created to be used by the internet public.au for Australia. That part of the domain name selected by the individual may be referred to as the identifier.arpa) for internet infrastructure.com (commercial) . Top Level Domain names (TLDs) There are two types of top-level domains – generic (gTLD) and country code (ccTLD) – plus a special top-level domain (.cat (for Catalan language/culture) . The number of possible domain names depends in part on the protocols used and the number of unique meaningful letter and numeric combinations.iana.info (unrestricted general use) . However.nz for New Zealand.net (internet organisations) .5 Generic Top Level Domain names (gTLDs) Registrations may be made through dozens of competing registrars.name (individuals) . and this name is referred to as the domain name. The code . . such as . For the human user a name is assigned to each specific group of numbers. These are the current open gTLDs: .jobs (human resource managers) .mobi (mobile products) . .

which is part of the ICANN’s role. On three occasions since 2000 ICANN has rejected the proposal for the .travel for the travel industry and . The .travel (travel industry) The . In 2008 the ICANN Board approved a recommendation to introduce new gTLDs into the internet’s addressing system.berlin and .xxx gTLD. The committee’s determination is not binding on the ICANN Board.mil domain is reserved exclusively for the US military. . and . The proposal allows applicants to self-select their domain name.xxx for sexually explicit sites. More than 100 000 domain names have been pre-registered in anticipation of the possible release of the .cat for the Catalan community). . There will be a limited application period where any established entity from anywhere in the world can submit an application. services and places. for instance.aero. The . but does carry significant weight.gov domain is reserved exclusively for the US government. to commence in 2009.edu domain is reserved for postsecondary institutions accredited by an agency on the US Department of Education’s list of Nationally Recognised Accrediting Agencies. ICANN had previously considered: . free speech. This is intended to foster choice and competition in domain registration services. 6 See ICANN website for the latest information: www.post for postal services. From time to time ICANN has considered applications for an expansion of the gTLDs.nyc (New York City).xxx gTLD.tel (for services involving connections between the telephone network and the internet) . All applications will go through an evaluation process. Registration restrictions for these TLDs have been developed by the sponsor with input from the community. ICANN Chairman Dr Twomey referred to the change as ‘a massive increase in the “real estate” of the internet’. Offensive names will be subject to an objection-based process.org. . ICANN regards the issue as controversial and ‘polarising’.130 LAW OF ELECTRONIC COMMERCE . The Governmental Advisory Committee of ICANN has given this serious consideration in an attempt to control the proliferation of sexually explicit websites. The implementation of a .coop.int domain is used only for registering organisations established by international treaties between governments.museum TLDs are sponsored TLDs and are designed for use within a specified community.kids for children. products.xxx domain raises issues of access. .icann. Trade marks will not be automatically reserved. The permitted names can be anything – occupations.pro (professionals) .6 Applicants may apply for ‘community strings’ (like the existing . government censorship and industry legitimisation of sexually explicit material.nyc for New York City. The . Consortiums have already expressed an interest in city-based gTLDs such as . and . . The .paris.

com.in as well as other categories (such as .uk and . In September 2001. This chapter will use Australia.co. India permits the gTLD .ac to . such as .co.edu.org.id.us.au . India. such as Pakistan and Brazil.au . .au operator and transferred control of the domain.edu (for example . The restrictive approach continues in countries such as Australia and the United Kingdom. requiring only .au.in).htm. The reasons for limiting domain names to those with the appendage .oz. .in and . See www. . The United States. The United States. not to expand domain names to almost any combination or language.icann. and others have preferred . on the other hand.info. through its considerable influence in ICANN.com. others have no restrictions. have been outspoken critics of the United States’ influence online.8 Many jurisdictions have a limited second level domain name (2TLD) structure.in).au commercial network services education government limited individual use major information resources ACSNet members X.com.uk and so forth.7 Country Code Top Level Domain names (ccTLDs) Each country code has its own structure. where there are a limited number of choices. The non-profit company .in).org.int/amc/en/domains/cctld_db/index.au.au .uk.net.ac.au .au domain since gaining government endorsement. There have been no technical or logistical reasons. can still affect which country codes are permitted and who will run each.400 Gateway 7 See www. .org/en/topics/new-gtld-program.au In Australia there are 12 .co to .au 2TLDs.au . New Zealand.au.org.au .au Domain Administration Ltd (auDA) has operated the .telememo.wipo. 9 See www. other than size. the United Kingdom and the United States as examples.icann.com (for example . 8 It is most impractical to deal with the vicissitudes of more than 240 domain administrators. . . Some nations.au .DOMAIN NAMES 131 The expansion of gTLDs is long overdue.org and the like are purely historical.org and www.ac.uk and .gov. has no such limitation.auda. independent from gTLDs.org. ICANN recognised auDA as the . .com.html.co. Some jurisdictions have preferred .9 auDA have put in place a system of registrars who compete with each other to provide a variety of packages to registrants.

A registrant must be an identifiable individual over 18 or a properly constituted organisation.nz .nz tertiary educational institutions and related organisations organisations pursuing commercial aims and purposes Crown research institutes individuals and other organisations not covered elsewhere for people who are concentrative.conf.asn.nz.nz .us domain is administered by NeuStar and was launched in April 2002.com.net.neustar.nz Shared Registry System.11 .internetnz.nz domain names directly with the registry.org.org.nz .10 NZ domain names cannot be owned by any party and are regarded by the DNC as licensed.mil. Registrars are authorised by the DNC.co.iwi. Other than reserved words.nz .geek. The DNC is an operational office of InternetNZ (the Internet Society of New Zealand Inc.nz .us In the United States there is one top-level domain: .nz . there is no restriction on the use of a 2TLD. secondary and pre-schools and related organisations .nz . and for the authorisation of registrars. 12 See www.132 LAW OF ELECTRONIC COMMERCE .nz .us.ac.net.au CSIRO conferences and exhibitions miscellaneous (for registered organisations) associations and non-profit organisations . 11 Rule DNC policy on Registering.school.nz . groups.nz domain name registration and management system.).au .csiro.nz/content/ registering_managing_cancelling. and Cancelling Domain Names: dnc.12 10 See www.maori.govt.pdf.org. Managing. technically skilled and imaginative who are generally adept with computers national. . and the transfer of management of specific domain names. and organisations military organisations of the NZ Government organisations and service providers directly related to the NZ internet not-for-profit organisations primary. There are no secondary categories such as . Hapu that belongs to a traditional Maori Iwi or taura-here Iwi group operating with the permission of the main Iwi Maori people.au .nz The New Zealand Domain Name Commissioner (DNC) is responsible for the dayto-day oversight of the . regional and local government organisations operating with statutory powers a traditional Maori tribe.au .gen.nz . authorised registrars can register and manage .cri. The .biz.us.nz . Under the .

uk.nominet. Nominet UK. Nominet does ‘not impose restrictions’ on the ‘status as applicant for the registration’ of the domains .gov.in The National Internet Exchange of India15 (NIXI) is the official .plc.uk .uk .uk .uk . At that time a voluntary group called the Naming Committee managed the registrations. name uniqueness and a geographic reference point for all registrants.police. See www.ltd.uk TLD was first used during the 1980s. a private non-profit company limited by guarantee.nixi. technical and legal. and a turnover in excess of £12 million.co.nhs. Day-to-day operations are carried out by three departments: operations.uk.uk .registry.me.in ccTLD and ensuring its operational stability.uk . .org. .us structure is a locality based hierarchy modelled on the geography of the United States.in registry.ac. .uk . The INRegistry was created by NIXI. Rule 4. The Policy Advisory Board develops proposals for policies and rules for consideration by the Council of Management.uk .14 . . 13 14 15 16 See www. This was replaced in 1996 by Nominet UK.16 It functions as an autonomous body maintaining the .DOMAIN NAMES 133 The . reliability and security. Nominet has more than 130 staff.me.org. This hierarchical design provides structure. making it the fourth largest internet registry in the world.uk or .uk.uk The .4 of the Rules of Registration and Use of Domain Names.uk . Branches in the locality space are overseen by delegated managers known as delegees or locality delegees.co.net.mod.uk .in.13 Nominet manages more than four million domain names.sch. See www. It implements the policies set out by the government of India through its Ministry of Communications and Information Technology and Department of Information Technology.uk .in.org.co. NIXI and INRegistry assumed responsibility in January 2005.uk domain is a fully open domain.uk commercial enterprises personal domains non-commercial organisations registered company names registered company names Internet Service Providers schools academic establishments government bodies NHS (National Health Scheme) organisations UK police forces Ministry of Defence establishments The .

in general commercial Internet Service Providers other organisations firms general individuals academic Indian research institutes education Indian government Indian military TLD rationale The rationale for gTLD protocols is unconvincing. and spaces.ac.in .in and .in .com.in .in . which allows US registrants greater freedom in the selection of their domain names than registrants in other countries. The ‘www’ similarly remains an anachronism. There are no technical reasons why an open domain name cannot be the full company. . and thus also potentially costly and timeconsuming court action and dispute resolution.edu. for example. INRegistry does not carry out registrations itself: it accredits registrars. The attempt to expand gTLDs and implement .ac. Permitting domain names of any composition and length would reduce the numbers of conflicts of names. Many national domain name administrators have following the protocol requiring . ERNET the registrar for . . The requirement to include dots and suffixes such as ‘com’ and ‘org’ is now a historical anomaly. The public is familiar .in .in domains.ind.in .in . The current protocols are reminiscent of the early naming protocols of computer files.in .in domains.co. Subsequent protocols cater for long meaningful names. as resources and authority are based on them. remain completely open and free from such protocols.edu for example in addition to the country code.net. From ICANN through to the many registrars.in . processes are highly developed and many vested interests may be compromised by redevelopment. It has been a failure.in . some jurisdictions.res. and the Ministry of Defence the registrar for . However. personal or business name.in domains. such as the .biz.firm.gov.us regime.res.mil. though.gov. Naming files with cryptic names was often problematic.org.gen. The identifier in front of .mil. . when operating systems could only accept a maximum of eight characters with a dot and three more characters and spaces were not permitted.in .us does not have to include any particular secondary suffix. was intended partly to alleviate the congestion in the . Regulatory authorities are vested in the current processes.org.134 LAW OF ELECTRONIC COMMERCE At the same time the National Informatics Centre (NIC) became the registrar for . including spaces.com protocol.

giving rise to inconsistent results and mass confusion.org domain is operated by Public Interest Registry. The . Conversely. protocol identifier assignment. to achieve broad representation of global internet communities. ICANN maintains each domain name map.biz domain is operated by NeuLevel.com. Attempts in the other protocols are typically not contemplated.name domain is operated by Global Name Registry. First guesses are typically <guess>.aero domain is sponsored by Soci´t´ Internationale de T´l´communication A´ronautiques. The . The . internet gambling.DOMAIN NAMES 135 with .org for more detail on this entire section of text. competing systems with conflicting maps of the internet could evolve. data protection or privacy. Its mission is technical coordination. internet content standards. to control or minimise abuses such as cybersquatting. the country code TLDs allow local authorities to regulate usage. There is no necessity to overhaul the ccTLDs in line with any gTLD review. The . The . ICANN ICANN is the international private/public non-profit corporation responsible for managing and coordinating the domain name system (DNS).com. 17 These services were originally performed under US government contract by the Internet Assigned Numbers Authority (IANA) and certain other bodies. but is responsible for coordinating the management of the technical elements of the DNS to ensure ‘universal resolvability’: making sure that all users of the internet can find all valid addresses. Without it. ee ee e The . 18 The . Its role is to ensure that each IP address and domain name is unique and that internet users are able to locate all addresses. the Internet Protocol (IP) address space allocation. ICANN accredits the domain name registrars by setting minimum standards for the performance of registration functions.pro domain is operated by RegistryPro.com and . consumer protection. vetting applicants in relation to those standards and managing accreditation agreements. and to develop policy appropriate to its mission through bottomup. The . The removal of the obligatory suffixes would change users’ attempts to inputting the identifier alone. and to impose conditions appropriate to their own jurisdiction. country code top level domain name (ccTLD) systems and root server system management. . This is the critical feature of the internet. The ccTLDs also allow for local registrations (and thus increased diversity) and for multinational corporations to have specialist local websites while retaining the same identifier.info domain is operated by Afilias Limited. See www. While ICANN supervises registrars and the allocation of gTLDs.coop domain is sponsored by DotCooperation LLC.net domains are operated by VeriSign Global Registry Services. The .icann. consensus-based processes.17 ICANN’s stated objectives are to preserve the operational stability of the internet.18 ICANN is not responsible for transactions and dealings on the internet such as financial transactions. the actual registration of domain names is performed by specialist registrars. spam. generic top level domain names (gTLDs). to promote competition.museum domain is sponsored by the Museum Domain Management Association.

InterNIC provides four significant services.cgi and reports. businesses.net/cgi/rpt_whois/rpt. and is the leading example of an alliance by the many constituents of the internet society. InterNIC (Internet Network Information Center) remained the internet governing body primarily responsible for domain name and IP address allocations until September 1998.internic.html. international treaty organisations.net/ cgi/registrars/problem-report. Second. Participation in ICANN is open to all with an interest in global internet policy. This is an efficient and cost-effective method of resolving disputes over domain names. California). InterNIC The initial body coordinating the network was the NIC (Network Information Centre) at SRI (Stanford Research Institute in Menlo Park. ICANN maintains relationships with governments. partly by lowering domain name costs by 80 per cent. which is a map permitting the registration of domains in languages other than English.net/regist.html.19 This registry provides contact details for all domain names registered using TLDs.internic. ICANN has set up online forums through its website and holds public meetings throughout the world. Third.net/whois.cgi. ICANN’s President directs an international staff. This role was transferred to the Internet Assigned Numbers Authority (IANA) in 1972. reports. . Fourth. ICANN implemented the Uniform Domain Name Dispute Resolution Policy (UDRP) in 1999. ICANN has adopted guidelines for the Internationalised Domain Names (IDN). ICANN has established market competition for gTLD registrations. it allows the Whois data to be monitored: the public can report inaccuracies using a Registrar Problem Report Form. respectively.136 LAW OF ELECTRONIC COMMERCE ICANN’s board of directors includes representatives of more than a dozen nations. Its role is to oversee the policy development process and to respond to rapidly changing technologies and economies. www. Its Supporting Organisations and Advisory Committees have active mailing lists for participants. 19 See. saving registrants more than US$1 billion annually in fees. The InterNIC website is now operated by ICANN to provide the public with information regarding domain name registration services. it provides registrar contact details in an Accredited Registrar Directory. In 1993 the US National Science Foundation created InterNIC to take over and manage the allocation of addresses and associated databases. associations and individuals.internic. users can file a complaint using an online Registrar Problem Report Form. when this role was assumed by ICANN. www. More than 80 governments closely advise the board of directors via the ICANN Governmental Advisory Committee.internic. working from three continents. First is the creation of the Whois registry.

html. In relation to the Ombudsmen generally. and to encourage its use.org. and allowing the community to see the results of previous cases. see www.htm. which may result in forfeiture of the domain name. For TLDs.org/ombudsman. Failure to maintain accurate details is regarded as a breach of the licence agreement.us.inregistry.org.icann. The Ombudsman serves as an objective advocate and can resolve complaints about unfair or inappropriate treatment.au/whois. using ADR (alternative dispute resolution) techniques such as negotiation.auda. . initial contact can be made using the Whois database. see www. Where a potential conflict in use of domain name arises.24 ICANN Ombudsman The first ICANN Ombudsman was appointed in November 2004. 22 See www. facilitates legitimate dispute resolution concerns.mywebname. 21 See www.whois.nic.26 The Office of Ombudsman reports only to the ICANN Board.icann. 23 See dnc.iana. and shuttle diplomacy. 26 See www. by posting complaints and resolutions to a dedicated portion of the ICANN website. allows rapid resolution of technical problems and permits enforcement of consumer protection.21 Nominet in the United Kingdom. The Ombudsman’s secondary functions include promoting an understanding of pertinent issues in the ICANN community. The Ombudsman also conducts outreach programs to increase consumer awareness of and raise the level of understanding of the Ombudsman process. an IP address or an autonomous system number (ASN) on the internet. to protect the confidentiality and privilege of communicating.uk. The postings will be generic. The Ombudsman can only be removed from office by a 75 per cent majority vote of the board.in/whois_search.22 the Office of the Domain name Commissioner in New Zealand23 and INRegistry in India. 24 See www.au and www. facilitation.internic.20 NeuStar in the United States. It is the policy of ICANN and other domain name administrators to provide and maintain registers of domain name licensees and all registrars. trade mark and other laws. The 20 See www.25 The primary function of the Ombudsman is to provide an independent internal evaluation of complaints by members of the ICANN community about ICANN’s staff or board or an ICANN constituent body.net/whois. The country code Whois database is at www.DOMAIN NAMES 137 Whois Whois is an internet protocol for users to find details of the owner of a domain name. InterNIC maintains a Whois site at www. 25 Frank Fowlie.com.org.org/cctld/cctld-whois.php.org/ombudsman. raising awareness of administrative fairness.nz/whois. Whois databases are maintained by auDA in Australia.usombudsman. This facility better informs the public.

or issues relating to membership on the board.info domain is an unrestricted domain for websites containing information about individuals. there is no process to check the legitimacy of such declarations. The Ombudsman may decline jurisdiction over a complaint based on an action or inaction more than 60 days old in various circumstances. but was intended to serve the non-commercial community. Historically it was intended for and is still commonly used by Internet Service Providers (ISPs). 27 See www.org/ombudsman. .138 LAW OF ELECTRONIC COMMERCE Ombudsman has access to all ICANN documentation and files and can interview staff and board members. 29 See www. The .biz domain is restricted to businesses. The .name domain is reserved for individuals.net is that the applicant must complete a declaration that there is no infringement of another’s rights in respect of the domain name.pro domain is restricted to certified professionals and related entities.org and .museum domain was developed exclusively for the museum community. organisations and products.com.28 The Ombudsman does not have jurisdiction over complaints concerning internal administrative matters. .org domain is unrestricted. or where the complainant engages in an outside legal process.org/ombudsman/framework. The Ombudsman provides an annual report to the board. including where the complainant does not have sufficient personal interest in it. The . However.icann.org. The . or over issues relating to vendor/supplier relationships. 28 See www. gTLD nexus requirements The single ‘nexus’ requirement for the open domain such as .29 Nexus requirements Before registering a domain name some national domain administrators require a nexus with the jurisdiction or affiliation with the type of domain used. vexatious. personnel issues. the complaint is repetitive. trivial. The . otherwise abusive or not made in good faith. The . The .aero domain is exclusively reserved for the aviation community. The . which is posted on the ICANN website. The .html. The . non-substantive.net domain is a gTLD for many types of organisations and individuals globally.coop domain is restricted to use by bona fide cooperatives and cooperative service organisations that subscribe to specific cooperative principles (such as member ownership and control).usombudsman.icann.com domain is a gTLD originally intended for commercial businesses around the world. frivolous.27 The Ombudsman charter provides that the Ombudsman will adhere to the standards of practice adopted by The Ombudsman Association.

and not contain hyphens in the third and fourth position.DOMAIN NAMES 139 Persons who claim that they have been aggrieved have only two courses of action: they may use ICANN’s UDRP30 or take the issue to a court of law and rely on established legal principles.net. the domain name must exactly match. To be eligible for a .au a 30 See www. an activity that the registrant facilitates. numbers (0–9) and hyphens (-) (or a combination of these). ● an Australian partnership or sole trader. There are serious concerns with the directions taken by the UDRP arbitrators.au domain name a registrant must be: ● an Australian registered company. ● a foreign company licensed to trade in Australia.au. start and end with a number or a letter.org.org/udrp. .icann. Additionally.33 It is not possible to reserve a domain name.au nexus requirements Of the 12 . The main reason is the ability to register to anyone with any combination of letters and numbers without there being any effective nexus requirement. The auDA directors have made a serious attempt to minimise and reduce the cybersquatting and typosquatting that are so prevalent in the .au are open to the general public.au for more detail on this section of text. .com.net.org. Domain names must be at least two characters long. a service that the registrant provides. Bad faith registrations are referred to as cybersquatting. 33 See www. To be eligible to use .auda. the domains . To be eligible for a . Renewal is automatic provided there is compliance with the nexus (eligibility) and allocation rules.32 .com domain by requiring some form of pre-existing interest in the name before registration is permitted.com.asn.au 2TLDs. The remedies available by the legal system were not designed to meet the particular exigencies of domain names. or ● an Australian commercial statutory body. teaches or trains. be an acronym or abbreviation of the name or be closely and substantially connected to the registrant by referring to a product that the registrant manufactures or sells.com TLD. . ● an owner or applicant of an Australian Registered Trade Mark.org. contain only letters (a–z). 31 See infra.au and . an event that the registrant organises or sponsors. first served basis and are fixed at two years.asn.au.id.au. These domain name licences are allocated on a first come. This has led to considerable speculation in registering domain names. ● trading under a registered business name in Australia. a venue that the registrant operates or a profession that the registrant’s employees practise. ● an incorporated association in Australia.au domain name a registrant must be a charity or non-profit organisation operating in Australia.au or . . 32 See infra.31 There have been multiple illegitimate registrations of domain names in the .

It substantially mirrors the ICANN UDRP.us TLD must be: ● a natural person who is a US citizen. for instance. be an acronym or abbreviation of the personal name or be closely and substantially connected to the registrant because the domain name is derived from one or more words of the registrant’s personal name or includes one or more words of the registrant’s personal name.34 No test is made to determine if the same or a similar domain name already exists.pdf. Once other criteria are met. These nexus requirements have substantially reduced the number of domain name disputes in Australia. . Registrants do not need to be based in New Zealand.au domain name may be revoked where the registrant is found to be in breach of the relevant policy rules: if the registrant makes a false warranty to the registrar. an activity that the registrant facilitates.org.35 . an organisation registered under Workplace Relations legislation or a sporting or special interest club operating in Australia. There are many registrars who publicly state that the nexus requirements and restriction ought to be lifted in favour of ICANN’s more liberal approach. a program that the registrant administers.140 LAW OF ELECTRONIC COMMERCE registrant must be an incorporated association. Managing. a venue that the registrant operates or a profession that the registrant’s members practise.asn. The rules cannot eliminate such disputes.au the domain name must exactly match. permanent resident or has a US primary place of domicile. 35 DNC policy on Registering.auda. 34 auDA policies are available at www. nor does their domain name need to be hosted in New Zealand. and Cancelling Domain Names. The domain name must exactly match. For both . A potential registrant needs only to register a business name which technically complies with the auDA rules to nevertheless register a bad faith domain name. teaches or trains. A .nz nexus requirements A registrant needs to be an identifiable individual over 18 years of age or properly constituted organisations. the domain name is issued.org.nz/content/ registering_managing_cancelling.org. To be eligible for a . dnc. be an acronym or abbreviation of the name or be closely and substantially connected to the registrant by referring to a service that the registrant provides. Bad faith registrations also cannot be eliminated.au/policies.au and . an event that the registrant organises or sponsors.id.au domain names was adopted in August 2002. as there may remain legitimate yet conflicting claims to a particular domain name.us nexus requirements A registrant in the . a registered political party. .au domain name a registrant must be an Australian citizen or resident. The auDA Dispute Resolution Process (auDRP) for the open .

us/policies/docs/ustld_nexus_requirements. requires initial certification. The .uk/registrants/legal/rules. email address. We may request certain information from you regarding your legal identity when you make an application for or seek to amend the registration of a Domain Name in the Open SLDs.in nexus requirements A registrant does not need to be based in India. nor does their domain name need to be hosted in India.org. postal address. and will take no action in respect of registrations that do not comply with the SLD Charters.us TLD registrants remain in compliance with the above requirements.in/register/. the . It is a continuing requirement that all . ● the name.pdf. the identity of the delegated manager under whom the name is registered. ● the name and postal address of the domain name registrant. or a foreign entity or organisation that has a bona fide presence in the United States.uk rules rely entirely on the expressed intentions of the registrant.uk nexus requirements The . we do not forbid applications. 37 See www. NeuStar.DOMAIN NAMES ● ● 141 a US corporation.uk SLD Charter for the open SLDs sets out certain intentions regarding the class of applicant or use of registrations of the domain name. conducts a scan of selected registration request information and conducts spot checks on registrant information. . 38 See www. ● the original creation date and term of the registration. the registration will be cancelled and the name will be returned to ‘available’ status. ● the IP address and corresponding names of the primary and secondary name servers for the registered name. voice telephone number and where available the fax number of the name holder. If compliance is not corrected within the 30-day period.38 36 See www.36 . The Charter also states: However. The information required from registrants for the Whois database is: ● the domain name registered.37 .neustar.registry. Failure to comply with these requirements results in the domain name being placed on a 30-day hold.us TLD administrator.nominet. technical contact and administrative contact for the name registered. ● the registrar name and URL or. where appropriate.

000. see the policy by auDA at www.auda.9 Domain name disputes Domain names disputes arise for a number of reasons.com for US$55. 2 For an example. The next chapter deals with the application of the Uniform Dispute Resolution Policy (UDRP) of ICANN and selected national domain name administrators.com for US$800. www.com and www.org. cinema.com. This chapter analyses the nature of domain name disputes and remedies using national courts.com sold for US$3 million.2 However. extort money from or disrupt the operations of established organisations. Such an action is known as cyberpiracy. cybersquatting or typosquatting. a person who registers a domain name identical to a well-known 1 For example.greatdomains.1 These transactions are part of commerce and offend no legal precepts.000 and HappyBirthday. In addition to these relatively accidental conflicts.com. domains.com. some parties deliberately register names to hijack businesses. Cybersquatting Speculating on the resale value of internet domains names has become a profitable pastime for internet devotees. loans. see www. and with selected dispute resolution policies.biz. For example. those who breach such a rule risk forfeiting the domain name. 142 .domainbarn. ICANN and most National Domain Administrators accept the principle of first come first served.dotcomagency.au/policies. The uniqueness of each domain name leads to the potential for conflicts with businesses and individuals with similar names. many country code domain administrators prohibit the selling of domain names. Also.

Prior to 1999. October 1994. in part to generate a story. A05. The value to the cybersquatter lies in the fact that every domain name is unique. such as Pitman’s case (see below). The possibility of registering these identifiers as domain names is a consequence of the highly automated and efficient first-come. InterNIC first agreed to revoke the registration.5 Dispute resolution Paralleling the growth of the internet.DOMAIN NAME DISPUTES 143 or famous name for the purpose of subsequently demanding an exorbitant fee for ‘transfer’ (that is. While some cybersquatters were a nuisance asking for sums too small to consider a formal legal challenge. However. McDonalds ultimately agreed to donate $3500 to purchase the equipment. firstserved system used for domain name registration. . Newsday.3 Some registrations offend particular sensitivities: when the names of eminent political. sale) is referred to as a cybersquatter. In 1994 Joshua Quittner. In many jurisdictions squatters attain real proprietary interests through continuous possession and the passage of time. scientific and religious persons. You deserve a break today. cities or indigenous peoples are registered by people with no actual association with those names. starting with ICANN.4 This is the first known instance of a person obtaining an economic benefit from a willing registrant. Marcovitz. a journalist.com. ‘ronald@mcdonalds. claimants challenging a particular registration only had recourse to the legal system.com – Owning a bitchin’ corporate trademark as an internet address – infringement?’.com site to promote vegetarianism. (1995) 17 Cardozo L Rev 85. and helped preserve universal connectivity. 4 Joshua Quittner. Many organisations were slow to recognise the importance and impact of a domain name as a business identifier. then changed its mind. From 1999. domain name 3 Squatting can lead to the establishment of possessory title or historical title and is well established in common law jurisdictions. Under pressure from the corporate giant. and the names of countries.com and asked readers for comments. the demand for domain names rose and disputes became inevitable. The term cybersquatting originates from ‘squatting’. contacted the McDonalds Corporation to ask why they had not registered mcdonalds. Many were innocent conflicts. cybersquatting became rampant. 5 See James W. others insisted on large sums amounting to extortion. Some suggested he use the mcdonalds. typically used to refer to physically taking over ‘tenements’ and refusing to move. a system that does not involve any screening of domain name applications. He created the email address ronald@mcdonalds. Quittner published an article offering the name back to McDonalds in exchange for computer equipment for a local school. Quittner then registered the domain name. leaving the registration with Quittner. others suggested requesting an exorbitant price for its sale. for instance. but that has allowed tremendous growth in the use of the internet.

to an existing business or corporation name. plus goodwill. The Comp Examiner Agency Inc. and courts have considered trade mark rights. The first step in registering business names. Typically. A determination may also be made on whether the name is too similar. 7 District Court California Case No. 96–0213-WMB US Dist LEXIS 20259 (CD Cal 1996). as the courts have moulded and shaped pre-existing elements to suit new factual situations. . and inevitably disputes arise concerning interests in given domain names. Domain name rights were effectively unheard of prior to the 1990s. Additional steps include whether the proposed name is misleading or offensive – there tend 6 [1997] EWHC Ch 367. the business or corporate name must be registered. However. These two options remain in most jurisdictions today. The law did not have an obvious remedy for this.6 or deliberately registered with the aim of extortion.7 claimants maintained some form of proprietary right. Those who hold established business identifiers. This concept is well established in most jurisdictions. new technologies may permit new relationships and interactions at a scale not previously anticipated. In the majority of situations standard legal principles can resolve the issues. 25th Century Internet Publishers v Juris Inc. as in Panavision International v Toeppen. 3d 1316 (9th Cir). company names and trade marks has traditionally involved determining whether or not the name has been previously registered. Remedies using the court process Electronic commerce has been embraced by a broad range of bodies and individuals. misrepresentation issues and the tort of passing off. as in Pitman Training Limited v Nominet. to operate a business under any name other than a personal name. Domain name rights and issues are such areas. Names that are identical to an existing business or corporation name anywhere within the jurisdiction will not be registered. CV-96–03284-DDP (1996) and on appeal (1998) 141 F. No. for commercial and personal reasons. Courts were asked to apply existing legal principles which were not designed for and were often ill suited to this new world. The latter particularly requires consideration. the right to a domain is first come first served.8 In Pitman’s case the court ruled that in the absence of any established cause of action and all other factors being equal. plus trade marks demanded the right to domain names which they regarded as belonging to them. within the jurisdiction of a state or country. v Stanley H Kaplan Educational Centre Ltd 84 Civ 1604 (MGC) (SD NY 1994). perhaps deceptively so. 8 For early examples see The Princeton Review Management Corp.144 LAW OF ELECTRONIC COMMERCE administrators initiated a compulsory Uniform Dispute Resolution Policy (URDP) for registrants. Cause of action Whether innocently registered.

Royal. Smith Electronics and so on. UNICEF. Charity. Police and University. However. It represents that company’s computer site and is the means by which that company’s customers can find it on the Internet.9 Some jurisdictions will search and consider the trade marks register. .com. when it attempted to expand into Australia. United Nations. there are businesses all over the world with names such as Smith Bros. A computer which is attached to an appropriate network can use appropriate software to communicate and exchange information quickly with any other computer on the network. There can be no identical domain names in different countries. and intellectual property lawyers in the planning of a proposed international product. In 1997 the case of Pitman Training Limited v Nominet13 was the first decision on internet domain names in the United Kingdom and described domain name competition: The Internet is a network of computer networks.co. and each domain name is a unique international address.12 and full or extended use of the actual business name. For example. it found that its business name was already trademarked by a person running a small takeaway food shop. 10 There is a significant role for patent attorneys. the United Kingdom and New Zealand use . In Australia Burger King is branded as Hungry Jacks. 11 See supra.14 9 For example: Olympic. Smith Dry Cleaning. A domain name can be likened to an address. The major drawback to this system is that the allocation of names is jurisdictionally specific. Queen. such as country codes. For example. Smith Cars.000 of fast food restaurants in more than 60 countries. 14 [1997] EWHC Ch 367. the internet encompasses one jurisdiction. The availability of . but not elsewhere. Burger King is an international chain of more than 11. 13 [1997] EWHC Ch 367. though there can be a number of smith. today there can be identical names used in other countries. nexus requirements and other options. Red Cross. An application for registration in the New South Wales will result in searches being made in every state and territory of Australia. However. Each may wish to shorten the domain name to the logical choice ‘smith’. In order to receive or to make available information on the Internet a domain name is needed. service or business. 12 Where cc can be any country code. but there can only be one smith. This problem is exacerbated by the typically short domain names most registrants prefer.10 Domain name registration authorities have taken a simplistic first-come firstserved approach to the allocation of the domain names (though they must also ascertain nexus requirements11 ). others leave this to the applicant.cc. The problem of limited names is partly resolved by registration protocols.com. and find out whether or not their business identifier is already in use.biz was intended to reduce this concern. For example. However. A particular domain name will only be allocated to one company or individual. Expanding enterprises must deal with their encroachment on other jurisdictions.DOMAIN NAME DISPUTES 145 to be words and phrases that cannot be used without consent.com. It identifies a particular Internet site. Some nations do not use . Prince.

Toeppen had registered the domain name panavision. the UK naming committee transferred the domain name back. ‘one must take account of the extent to which the trade mark is known within the relevant sector of the public. In Australia. Knowledgeable internet users made a grab for well-known word-based corporate marks. acronyms and abbreviations.com before the multinational corporation of the same name had done so. Other jurisdictions have taken the same approach. On its own. personal names. The majority of domain names are ordinary words. Also. Cal. the first to register had the better interest in the domain name. . 16 See. relying on the initial ignorance of the future power and significance of domain names.15 The law did not recognise the plaintiff’s 150-year-old use as giving it any greater right than the registration by the defendant. Koninklijke Philips Electronics NV v Remington Products Australia Pty Ltd (2000) 100 FCR 90.uk. ‘is substantially identical with. Due to an administrative error. given that both parties had a prima facie right to use ‘Pitman’ in their business name. section 120(3) and (4) of the Trade Marks Act 1995 (Cth) provides that a person infringes a registered trade mark if ‘the trade mark is well known in Australia’. symbols and logos. 17 District Court California Case No. on the website.co. 3d 1316 (9th Cir). generally. CV-96–03284-DDP (1996) and on appeal (1998) 141 F. No. Judge Trott stated: ‘Panavision accuses Dennis Toeppen of being a “cyber pirate” who steals valuable trademarks and establishes domain names on the internet using these trademarks to sell the domain names to the rightful trademark owners. a town in Illinois. 95-CV-02525 (N. the domain name was wrongly allocated to the Pitman Training Ltd. After receiving a complaint from Nominet. whether as a result of the promotion of the trade mark or for any other reason’.D.16 US experience In Panavision International v Toeppen17 in 1996. and no relief could be justified.146 LAW OF ELECTRONIC COMMERCE Two UK organisations held the right to use the trading name ‘Pitman’ and wanted to use the domain name pitman. tortious interference with contract and (later) abuse of process. 1997).’ Toeppen displayed ‘visions of Pana’. One had been established for 150 years and the other for 12 years. The court considered this action to be a devious ploy 15 See Prince plc v Prince Sportswear Group [1998] FSR 21 and Fry’s Electronics v Octave Systems Inc. Pitman v Nominet was an open invitation to domain name squatters. An avalanche of cybersquatting occurred. or deceptively similar to’ goods or services and is ‘likely to be taken as indicating a connection between’ the goods or services. The plaintiff then commenced proceedings on the grounds of passing off. a substantial number include a registered trade mark. The court held that. The court also considered a number of additional causes of action which might justify granting relief. The court concluded that no wrong had been committed.

com. such as: aircanada. Secondly. See also Playboy Enterprises Inc.19 so its principles are not universally applicable. The identifier components of most domain names are not registered trade marks. ‘in bad faith’.000 clearly increased the court’s cynicism of Toeppen’s defence. 20 For example Trade Marks Act 1995 (Cth) s120. word. However.com. Trade mark infringement is universally incorporated into trade mark law. service marks. there are varying degrees of trade mark dilution law in other jurisdictions. flydelta.com. that are identical or confusingly similar to a trade mark or service mark. arriflex. where particularly well-known trade marks are involved. and yankeestadium. The legislation made a specific distinction between trade mark infringement and trade mark dilution. Trade mark infringement typically arises where a third party uses the trade mark in a manner likely to cause confusion.com.com. Toeppen’s argument – that his actions amounted to legitimate commerce – was rejected. Toeppen offered to settle the dispute for a payment of $13.20 The United States adopted specific legislation. Toeppen had also registered many other names. California Business and Professions Code § 14330. northwestairlines. The use by the third party may be said to impact the reputation of the trade mark. When Panavision refused this offer Toeppen registered panaflex. frenchopen. The court upheld Panavision’s ‘right’ to the domain name.com to Intermatic Inc.com. A trade mark may be a mark. such as intermatic.000 and americanstandard.18 Panavision’s cause of action was based on the US Federal Trademark Dilution Act 1995. most usually where the same class of goods is involved. Trade Marks Act 1999 (India) s29. consumers may perceive an association between the two uses. anaheimstadium.com. eddiebauer. colour.DOMAIN NAME DISPUTES 147 designed to mask Toeppen’s real intention: to extort a substantial payment from Panavision. thus lessening the strength of the established association between the trade mark and the original goods.com. US cybersquatting cases since 1999 have had the benefit of the Anti-Cybersquatting Consumer Protection Act (US). personal names and business identifiers legal remedies against persons who register or use domain names. deltaairlines. 2d 1220 (1997).com. Panaflex was another trade mark belonging to Panavision. Complainants must rely upon some other cause of action to persuade a court to provide relief.21 This Act is a US federal statute that took effect on 29 November 1999. name. symbol. for $15. Trade Marks Act 1994 (UK) s10. lufthansa.com. A service mark is a form of trade mark typically 18 The opinion stated that there were more than 100 such registrations by Toeppen. It is intended to give the owners of trade marks. smell etc which identifies particular products or services. for $10. 21 15 USC s1125(d)(2)(C).000 and promised not to acquire any other internet address which may be claimed by Panavision. The trade mark could be used for a different class of goods without causing confusion. displaying the word ‘Hello’ on the website. the consumer will begin to dissociate the trade mark from its original use. Toeppen had also previously attempted to ‘sell’ domain names for other trade marks. Trade Marks Act 2002 (New Zealand) s89(1)(d). v Calvin Designer Label 985 F. . 19 15 USC § 1125(c) and also the California anti-dilution statute.com. Supp. sound.com to American Standard Inc. australiaopen.com.

. confusingly similar to or dilutive of the mark. . and (ii) registers. or to tarnish or disparage the mark. with the specific intent to profit from such name by selling the domain name for financial gain to that person or any third party. and any intent to divert consumers. trade mark and service mark rights can be acquired by registration or through usage at common law. an intent to extort money from a person with legitimate rights and interests. Under this legislative remedy a court may order the forfeiture or cancellation of the domain name or the transfer of the domain name to the owner of the mark. including a personal name which is protected as a mark under this section. the same remedies are available if the domain name is identical to. and the likelihood of confusion as to the source. the first to either use a mark in commerce or file an intent to use application with the Patent and Trademark Office has the ultimate right to use and registration. It covers lack of a sufficient bona fide purpose. 23 The circumstances required are typically where the domain name is identical or confusingly similar to a mark.148 LAW OF ELECTRONIC COMMERCE used in the sale or advertising of services. including the forfeiture or cancellation of the domain name or the transfer of the domain name to the plaintiff. without regard to the goods or services of the parties. that person– (i) has a bad faith intent to profit from that mark. 25 [2002] FCA 124. affiliation. 24 15 USC 1129. 23 Trademark Act of 1946 (15 USC 1125) s43. If a service mark is famous. Generally. and false advertising. The Lanham Act defines the statutory and common law boundaries to trade marks and service marks. without that person’s consent. including a personal name which is protected as a mark under this section. International approaches In Sydney Markets Limited v Sydney Flower Market Pty Limited. or uses a domain name . The Act prohibits trade mark infringement. trade mark dilution. . and costs. or endorsement of the website. The Anti-Cybersquatting Consumer Protection Act also included a provision relating to the protection of individuals from cyberpiracy: Any person who registers a domain name that consists of the name of another living person. harming goodwill. The provision has an inclusive definition of ‘bad faith’ aimed at cybersquatting practices. In the US. or a name substantially and confusingly similar thereto. if. sponsorship. The Act amends the Lanham Act22 by adding cyberpiracy prevention: A person shall be liable in a civil action by the owner of a mark. shall be liable in a civil action by such person.25 the Federal Court of Australia stated: 22 Lanham (Trademark) Act (15 USC 22) is US legislation that contains the federal statutes of trade mark law.24 The remedies that a court may award are injunctive relief. traffics in.

.31 In Australia the plaintiff must prove that the interests ‘of the registered owner are likely to be adversely affected’. .28 The Trade Marks Act 2002 (NZ) s89(1)(d) provides: (1) A person infringes a registered trade mark if the person does not have the right to use the registered trade mark and uses in the course of trade a sign . [2000] HCA 12. Trade Marks Act 1994 (UK). the UK courts have held that detriment may be caused by erosion of distinctiveness or tarnishing of distinctiveness. Trade Marks Act 1998 (Singapore) and Trade Marks Act 1995 (Cth). or is detrimental to. It may be reasoned that a mark may only be well known in New Zealand where a significant part of the general public know of the trade mark. what is protected is ‘the commercial value or ‘selling power’ of a mark by prohibiting uses that dilute the distinctiveness of the mark or tarnish the associations evoked by the mark.30 In Singapore the plaintiff must prove that the interests ‘of the proprietor are likely to be damaged by such use’. [2000] HCA 12. paras 42–43. The ‘dilution’ theory of liability ‘does not require proof of a likelihood of confusion’. there is considerable scope for the public to be misled. . In Australia and Singapore it is the interests of the owner of the well-known mark that are primary. the UK case law may be most relevant. 26 27 28 29 30 31 32 [2002] FCA 124. where the only difference between them is the presence or absence of ‘. the distinctive character or the repute of the mark. Trade Marks Act 1998 (Singapore) s27(3)(d). Limitada v Nike International Limited27 the High Court of Australia (in obiter) stated that subsections 120(3) and (4) have: extended the infringement action to restrain activities which are likely adversely to affect the interests of the owner of a ‘famous’ or ‘well-known’ trade mark by the ‘dilution’ of its distinctive qualities or of its value to the owner. Trade Marks Act 1995 (Cth) s120(3)(d). the UK Act refers to a trade mark which has a ‘reputation’ in the United Kingdom. This may be contrasted with the United Kingdom. for example. or is detrimental to the distinctive character or the repute of the mark’ are from the UK Act. As a result.au’). para 149.26 In Campomar Sociedad.29 New Zealand and Singapore use the expression ‘well-known’ trade marks.DOMAIN NAME DISPUTES 149 where two domain names are sufficiently similar so as to make it difficult for a member of the public to know in advance exactly which site they will be taken to (as. Singapore and Australian approaches. rather. The Australian provision deals with marks that are well known ‘within the relevant sector of the public’.32 In New Zealand and the United Kingdom the emphasis is on the harm to the character or reputation of the mark. The words ‘take unfair advantage of. For example. Premier Brands v Typhoon [2000] RPC 477. (d) identical with or similar to the registered mark in relation to any goods or services that are not similar to the goods or services in respect of which the trade mark is registered where the mark is well known in New Zealand and the use of the sign takes unfair advantage of.

‘distinguishing goods or services of one person from those of others’. 37 See Andrea F.37 In Re Krupp. passing off and dilution too generously. Satyam Infoway appealed to the Supreme Court. using his first name. The defendant’s use of his first name was not allowed: the commercial reputation of the steel manufacturer was recognised as overruling his right to use his own name.com’. ‘Internet domain protection: A Canadian perspective’. and to have established a global reputation and goodwill in the name. The courts’ decisions in trade mark domain name cases have been criticised for construing the principles of infringement.36 Decided cases imply that the use of a domain name will override an individual’s right if a prominent.35 This natural right has been consistently negated in favour of the reputation of the commercial enterprises. The defendant used the domain names www. . ‘International domain name disputes: Rules and practice of the UDRP’. In Satyam Infoway Ltd v Siffynet Solutions Pvt Ltd. like the UK Trade Marks Act. A mark is defined to include a name and an abbreviation of a name. (1997) 34 San Diego Law Review 1463. It is argued that general common law principles have been either modified or negated to suit the requirement of trade mark owners. Rush.33 the plaintiff was one of India’s largest internet service providers (ISPs) and claimed to have formulated the word ‘SIFY’ from its corporate name. The word ‘krupp’ is also used as a trade mark by leading German steel company who wished to obtain the domain name ‘krupp.com. 35 See Marengo v Darly Sketch & Sunday Graphics Ltd (1948) RPC 242. 34 Adrian Wolff. . ‘Pursuing domain name into uncharted waters: Internet domain names that conflict with corporate trade marks’. there is a general rule that a person has the right to use his or her own name for the purpose of honest trading.sify.150 LAW OF ELECTRONIC COMMERCE In India. commercial and industrial activities. stating that the court must consider where the balance of convenience lies and that as there was no similarity between the two businesses there was no question of confusion. The Bangalore High Court reversed this. 1468. well-known business possesses a similar name. Its domain name was www.siffynet.34 For example.siffynet. (2003) 25 EIPR 351.com for his internet services in 1995. dishonest adoption’ of the plaintiff ’s trade name. The Supreme Court reinstated the injunctive relief.net and www. which.38 the defendant had registered the domain name krupp. 11. The Supreme Court considered that domain names could qualify as services and obtain protection under paragraph 2(zb) of the Indian Trade Marks Act 1999. (1997) 11 IPJ 1. 354. the Supreme Court has held that Indian trade mark laws provides direct protection for domain names. The court found that the outstanding commercial reputation of the plaintiff meant it had a right not to tolerate other 33 (2004) (28) PTC 566 (SC).com. 36 Anri Engel. It regarded the defendant’s actions as an ‘albeit prima facie . ‘krupp’. . The Indian Act widens the definition of ‘services’ so that it includes business. The plaintiff obtained a temporary injunction in the District Court on the grounds of prior user of the trade name. 38 [1999] EIPR N24. ‘Satyam Infoway’. defines a trade mark as ‘a mark capable of being represented graphically’.

‘nobody has any right to represent his goods as the goods of somebody else’. like many other cases. The underlying elements are active conduct by a defendant which causes actual damage to the plaintiff ’s goodwill or business. 41 [1990] 1 WLR 499. in Reddaway v Banham. 3)40 Lord Oliver of Aylmerton said. See also Reckitt & Colman Products Ltd v Borden Inc. typically in a business situation. also highlighted the fact that in most of the cases. (2) made by a trader in the course of trade. courts failed to consider even the basic principles of passing off – such as the effects or likelihood of confusion – and upheld the plaintiff’s claim even though parties were in completely different industries (in this case a steel producer and an ISP).’41 The leading case on passing off has been the House of Lords decision of Warnink v Townsend & Sons. 42 [1979] AC 731. This decision. 3) [1990] 1 WLR 491 and Hodgkinson & Corby Ltd v Wards Mobility Services Ltd [1994] 1 WLR 1564.DOMAIN NAME DISPUTES 151 firms bearing the same name weakening the value of its mark. the courts have exercised great flexibility to reshape the passing off concept so as to yield a remedy.42 where Lord Diplock defined the necessary elements: (1) A misrepresentation. Domain name passing off The expression ‘domain name passing off ’ was coined to refer to a new hybrid of the traditional tort of passing off. (No. in Orange Crush (Australia) Ltd v Gartrell: 39 [1896] AC 199. services or goodwill. stated. (3) to prospective customers of his or customers or ultimate consumers of goods or services supplied by him. known as the Advocaat case. 204. Passing off involves appropriating a reputation that belongs to another and thus misrepresentation of goods. in an attempt to provide a remedy for domain name disputes. 40 [1990] 1 WLR 491.39 In Reckitt & Colman Products Ltd v Borden Inc. 43 [1979] AC 731 at 742. The tort of passing off is concerned with the protection of business reputation and with the protection of consumers from deceptive and misleading trading activities. However.43 In the High Court of Australia Isaacs J said. ‘The law of passing off can be summarised in one short general proposition – no man may pass off his goods as those of another. (No. In 1896 Lord Halsbury. (4) which is calculated to injure the business or goodwill of another trader (in the sense that this is a reasonably foreseeable consequence) and (5) which causes actual damage to a business or goodwill of the trader by whom the action is brought or (in a quia timet action) will probably do so. .

New Zealand users of the web were prospective customers. (1998) Trademark World.46 Baragwanath J stated that as a matter of law the plaintiff. Second. McKenzie registered oggi. McKenzie had ‘floated into Cyberspace’ a misrepresentation that McKenzie was associated with Oggi Advertising Ltd. Oggi Advertising Ltd v McKenzie In 1998 the High Court of New Zealand in Oggi Advertising Ltd v McKenzie. 19. and the plaintiff ’s counsel’s name. The initial registrant’s name was fictitious.nz.45 used passing off as the underlying cause of action. . or to promote 44 (1928) 41 CLR 282. name or get-up with which goods or services of another are associated in the minds of a particular class of the public. but was changed to ‘Elliott Oggi’ four days after service of the legal proceedings. This site was removed immediately after the complaint was made. 567. per Baragwanath J. Clive Elliott. The company sought an injunction claiming a breach of the tort of passing off. damaging its goodwill. Oggi. long before the internet and domain name rights were even contemplated. 45 (1999) 44 IPR 661. but in the business or goodwill likely to be injured by the misrepresentation conveyed by the defendant’s use of the mark. High Court of New Zealand. the defendant’s actions diverted business from Oggi Advertising Ltd. The plaintiff’s property in the goodwill is in its nature transitory and exists only so long as the name is distinctive of the plaintiff’s services in the eyes of the class of the public. 46 It has been suggested that the name ‘Elliott Oggi’ was deliberately chosen as a play on both the plaintiff ’s name. the defendant’s conduct ‘would probably cause actual damage’ to Oggi Advertising Ltd. no such person could be found and no further evidence of this person’s existence was presented. 6 NZBLA 102. name or get-up. They may not intend to trade. McKenzie argued that he had registered the domain name on behalf of a person he allegedly met on the net named Elliott Oggi. The website displayed phases connected with the plaintiff’s business (advertising): ‘Open your eyes – 80 million people can drive past – every day – the changing face of advertising’.152 LAW OF ELECTRONIC COMMERCE the right protected by the tort of passing off is not a property in the mark. Fourth. However. Third. August.44 This judgment was written in 1928. but upon any analysis it could prove to severely limit the possible remedies for other domain name disputes. 292. Oggi Advertising Ltd was an established advertising company preparing to set up a website. the defendant projected a ‘clear business implication’. See C Elliott and B Gravatt. McKenzie was ordered to assign the domain name to Oggi and remove any link whereby users could access his site using the name Oggi. in seeking the injunction to restrain the use of the domain name by the defendant. A significant proportion of cybersquatters may not intend to trade off the goodwill of the name of the target. needed to establish the five elements of passing off listed by Lord Diplock. Fifth.co. ‘The Oggi case: New Zealand domain name grabber dealt to’. His Honour made no attempt to extend passing off concepts any further. His Honour held that first. This may have provided a remedy on the facts of this case.

Should Baragwanath J’s approach in Oggi’s case be strictly applied. Such a factual situation arose in the UK case Harrods Ltd v UK Network Services Ltd. Fourth. the court ignored the elements of passing off and granted summary judgment.uk.co. Marks & Spencer being a well-known chain of department stores.uk. A strict application of the first-come first-served rule effectively blocked Marks & Spencer from acquiring registration of the name. Second.47 Harrods challenged the registration of harrods. damaging goodwill. Should a cybersquatter simply register a ‘well-known’ name and take no other steps. Marks & Spencer v One in a Million In Marks & Spencer v One in a Million48 the English High Court was faced with a similar situation to the Oggi case.uk and thetimes.uk.co.com by a third party. few plaintiffs would have a remedy. ordering the transfer of the domain name. Ladbrokes plc.uk. [1998] EWCA Civ 1272.com. A cynical observer may remark that English judges would not permit such an established name as Marks & Spencer to be usurped. there would be no ‘floating into Cyberspace’ of a misrepresentation of association with the plaintiff. motorola.uk.uk. burgerking. and thus devoid of argument. the defendant had made no attempt to use the domain name. 47 (1997) EIPR D-106.DOMAIN NAME DISPUTES 153 their activities on a website. nor did it set up a website.co. However. 48 Marks & Spencer plc. as the defendant. and on appeal [1999] 1 WLR 903.com. Telecom Securicor Radio Ltd v One in a Million [1997] EWHC Patents 357. there would be no diversion of business from the plaintiff. had speculatively registered a number of domain names. marksandspencer. The defendant did not use the domain name in any form of trade.co. Despite the absence of any trading on the goodwill of Harrods Ltd. there would be no prospective customers. Virgin Enterprises Ltd. Fifth. It had merely registered the domain name. British Telecommunications plc. or to set up a web page after registration. and pioneered the extension of the tort of passing off in a manner not previously contemplated. As in Harrods Ltd v UK Network Services Ltd. The English High Court refused to allow the absence of a precedent to foil the plaintiff ’s ‘right’ to a remedy.co. Some of the other names registered by the defendant included: britishtelecom. . there would be no probability of actual damage to the plaintiff. Third. J Sainsbury plc. See also Hoath v Connect Internet Services [2006] NSWSC 158. The defendant registered several domain names in the hope of on-selling them to interested parties. Australian Stock Exchange Ltd v ASX Investor Services Pty Ltd (QSC Burchett J (1999)) and connect. in a manner reminiscent of Toeppen. It had not placed any material online to be accessed via the domain name.co. macdonalds. there would be no projection of a ‘clear business implication’. This case is also known as British Telecom v One in a Million. This is an example of the courts finding and moulding a remedy to suit new circumstances.au Pty Ltd v GoConnect Australia Pty Ltd [2000] FCA 1148. this was an uncontested case. First. sundaytimes. One such domain name was marksandspencer.co. none of the five passing off elements would be met.

it will come in such a way and under such circumstances that it will be impossible for the plaintiff to protect himself against it if relief is denied to him in a quia timet action. para 19. if the damage does occur at any time. The judgment contained the broadest proposition for challenging a domain name under the tort of passing off. citing Singer v Loog (1880) 18 Ch D 395. Actual damage was not imminent. if the danger is not proved to be so imminent that no one can doubt that. because. To provide a remedy. His Honour reasoned that there was ‘only one possible reason’ to register the marksandspencer domain address: ‘to pass himself off as part of that group or his products 49 The court comprised Jonathan Sumpton QC sitting as a Deputy Judge of the High Court. His Honour described the ‘essence of the tort of passing off’ as a misrepresentation to the public. if the remedy is delayed. 52 Marks & Spencer plc v One in a Million [1997] EWHC Patents 357. para 19. None of the five passing off elements was met. The registrant may never have used the domain name registration at all and the evidence indicated that there was no intention to activate any website. 51 Marks & Spencer plc v One in a Million [1997] EWHC Patents 357.49 at first instance. liable to lead them to believe that the goods and services offered are those of the plaintiff. 698. and there must also be proof that the apprehended damage will. be very substantial. In particular. para 19.50 However. be proof of imminent danger. cited with approval by Lord Macnaughten in Camel Hair Belting [1896] AC 199. It is enough that what is going on is calculated to infringe the Plaintiff’s rights in future. it is questionable whether the application of these principles should lead to the granting of a quia timet injunction. 50 At para 16. His Honour added that the mere creation of this ‘instrument of deception’.’53 Quia timet injunctions are distinguished from others in that they may be granted against apprehended wrongs. is not passing off: ‘There is no such tort as going equipped for passing off. 55 (1885) 28 Ch D 688.54 Pearson J stated there are ‘at least two necessary ingredients’ for equity courts to grant a quia timet injunction: There must.55 With respect. I think it must be shown that. 215–16. . his Honour expanded the meaning of passing off and its application to a level not previously contemplated. if no actual damage is proved. if it comes.’51 The mere registration of ‘a deceptive Internet domain name is not passing off’. his Honour applied the principles of a quia timet injunction to restrain the ‘threat of passing off ’. I should almost say it must be proved that it will be irreparable. 412. whether or not intentional. considered and discussed Lord Diplock’s five passing off elements. the damage will be suffered. 53 Marks & Spencer plc v One in a Million [1997] EWHC Patents 357.154 LAW OF ELECTRONIC COMMERCE Sumpton DJ. 54 (1885) 28 Ch D 688.52 but a quia timet injunction may be ordered to restrain the threat of passing off rather than the actual tort: ‘[E]ven a final injunction does not require proof that damage will certainly occur. In Fletcher v Bealey. without some further act. He added that the tort is also committed ‘by those who put or authorise someone to put an “instrument of deception” into the hands of others’. his Honour.

DOMAIN NAME DISPUTES 155 off as theirs’. He expressed concern that there is a danger of deception simply through registration. the intention of the defendant. . stating that merely registering the domain name has the potential to amount to passing off: [Counsel] submitted that mere registration did not amount to passing-off. As with Sumpton DJ.58 The Court of Appeal regarded the mere registration of the domain name as an erosion of the exclusive goodwill in the name which damaged or was likely to damage Marks & Spencer. His Honour regarded the domain names as worthless to the defendant except as a negotiating tactic to extort payment from the plaintiff.uk would naturally assume that it was that of the Plaintiffs . The placing on a register of a distinctive name such as marksandspencer makes a representation to persons who consult the register that the registrant is connected or associated with the name registered and thus the owner of the goodwill in the name. Lord Justice Stuart-Smith. . Lord Justice Swinton Thomas and Lord Justice Aldous. I cannot accept those submissions. Not surprisingly. and the type of trade. a clear case of passing off would be made out ‘even if there is a possibility that such an appropriation would not take place’:59 56 57 58 59 Marks & Spencer plc v One in a Million [1997] EWHC Patents 357. Further. but determined that no relief is available for passing off which has not yet occurred: Someone seeking or coming upon a website called marksandspencer. para 20.co. Marks & Spencer Plc had not established any damage or likelihood of damage. Marks & Spencer plc v One in a Million [1997] EWHC Patents 357. and the injunction will be in terms which will make the name commercially useless to the dealer. the Court of Appeal limited its reasoning to famous and well-known domain names (which would ‘inherently lead to passing-off ’).57 His Honour ordered a quia timet injunction against the defendant. and blocking the use of the name by Marks & Spencer in order to induce them to pay. [1998] EWCA Civ 1272. In an attempt to fashion a remedy the court drew a parallel with the cases to grant injunctive relief where a defendant is equipped with or is intending to equip another with an instrument of fraud. . The Court of Appeal dismissed the appeal. paras 20 and 21. brand name or trade mark of an unconnected commercial organisation must expect to find himself on the receiving end of an injunction to restrain the threat of passing off. Any person who deliberately registers a domain name on account of its similarity to the name. One in Million appealed this new interpretation of the threat of passing off. If the intention of the defendant was to appropriate the goodwill. Note that the arguments of Sumpton DJ are directed at famous and well-known identifiers. Neither of these activities constitutes passing off.56 His Honour then contradicted this statement by acknowledging counsel’s submission of two additional uses not involving passing off: the resale of the domain name to Marks & Spencer. The factors to consider included the similarity of the identifier to the plaintiff ’s name.

. intentionally or unintentionally. name or other feature’. diminished reputation or some other like form of damage. This. and the court ordered deregistration. where the defendant has equipped himself with or intends to equip another with an instrument of fraud. and that ‘amounts to a false representation which constitutes passing-off ’. That the plaintiff has suffered. is likely to be fraudulently used.com. That the defendant has misrepresented. that a connection exists between the defendant or the defendant’s goods. where the defendant is a joint tortfeasor with another in passing-off either actual or threatened. [2002] QSC 139 para 13. damage either by diversion of custom. His Honour stated: The plaintiff must establish: 1. service. sometimes explicitly and on other occasions implicitly. That it holds goodwill or reputation in a specific trade or business. and the plaintiff or the plaintiff’s business. services or business. the court considered.au but unlike the Marks & Spencer case. First. A search on the ‘whois’ database reveals the defendant as the registrant. is adapted to be used for passing-off and. Developments Architects (Australia) Pty Ltd (trading as Architects Australia) v Witty Consultants Pty Ltd62 applied the Marks & Spencer case. and 3. Chesterman J of the Supreme Court of Queensland considered the issue of domain name passing off.60 The court proceeded on the basis that Marks & Spencer denotes Marks & Spencer plc and nobody else. The placement 60 61 62 63 64 [1998] EWCA Civ 1272. where there is passing-off established or it is threatened. [2002] QSC 139.156 LAW OF ELECTRONIC COMMERCE If. would lead a substantial number of persons to conclude that the defendant must be connected or associated with Marks & Spencer plc. an injunction will be appropriate. if used. [1998] EWCA Civ 1272.63 His Honour regarded the essence of an action for passing off to be the protection of goodwill ‘as embodied in the warmth of public sentiment towards its product.61 The court reasoned that the defendant’s purpose was to threaten use and disposal. It follows that a court will intervene by way of injunction in passing-off cases in three types of case. This third type is probably mere quia timet action. taking all the circumstances into account the court should conclude that the name was produced to enable passing-off. Second. The defendant registered architectsaustralia. [2002] QSC 139 para 14. the defendants argued that the words ‘Architects Australia’ are general dictionary terms combining a profession and location without any necessary reference to the plaintiff. Third. or is under threat of. 2.64 The words ‘Architects Australia’ were held to be ‘sufficiently fancy’ to be distinctive of the plaintiff ’s business to amount to an instrument of fraud.

In Qantas Airways Limited v The Domain Name Company Limited.68 the defendant registered the domain name qantas. The Yahoo India site had also copied Yahoo’s format. 66 See Titan Industries Ltd v Prashanth Koorapati & Ors (Application 787 of 1998 in action 179). The court noted that the identifier was a combination of three descriptive terms. ‘invest’. . The New Zealand High Court was quick to condemn this and ordered the defendant to de-register the name. Notwithstanding the similarity. Action 1040 of 2000. The plaintiff was the owner of the well-known portal rediff. is contained in the Trade Practices Act 1974 (Cth). layout.com. 67 AIR (2000) Bom 27.com.com. and granted an injunction based on the tort of passing off and trade mark infringement restraining the defendant from dealing in the identifier.66 A single judge of the Bombay High Court took the domain name passing off developments a step further. 69 Mumbai High Court. In Rediff Communication Ltd v Cyberbooth67 the Court stated that a ‘domain name is more than an Internet Address and is entitled to equal protection as trade mark’. 68 (2000) 1 NZECC 70005.com.com. The plaintiff was the owner of the well-established internet site Yahoo. contents. finding a prima facie case of passing off where the trade mark application was pending. the court refused to enjoin the defendant’s use. This was an example of typosquatting.nz. v Akash Arora65 the defendants registered yahooindia.co. similar to the tort of passing off. The defendant had registered radiff. It then attempted to sell the name to Qantas. In Yahoo Inc. ‘smart’ and ‘India’ and could be distinguished from such cases as the Yahoo India case where the unique identifier ‘Yahoo’ was at the centre of the issue. In Investment India Ltd v ICIC69 the plaintiff had registered investmartindia. The Court held that there was a clear ‘intention to deceive’ and that the only purpose of the registration was to trade on the goodwill and reputation of the plaintiff.com. colour scheme and source code. as well as the trade mark and the domain name yahoo.DOMAIN NAME DISPUTES 157 of a disclaimer on the defendant’s website was ineffective because in the view of the court it referred only to the plaintiff’s company name. the defendant had registered investsmartindia. sections 52 and 53: 65 (1999) PTC (19) 210 (Delhi). Delhi High Court. Based on this usage the Delhi High Court found that the defendant had ‘appropriated’ the identifier ‘Yahoo’. Trade Practices Act relief A statutory form of relief. not to its trading name. The Court found that such actions were a deliberate blocking of the lawful exploitation of the name and a fraudulent use of Qantas’s goodwill.

in the Federal Court of Australia. Despite the prior authorisation and agreement. . After a falling out between the parties Mumford demanded the removal of meta tags for websites which included his names and the cancellation of the registration the domain names omkarakriya. approval. uses or benefits they do not have.com and jonnmumford. . . engage in conduct that is misleading or deceptive or is likely to mislead or deceive. . The court regarded the use of Mumford’s name and pseudonyms as a misappropriation. ‘CSR’ and ‘CSR Sugar’ are registered trade marks.com. in trade or commerce.com. the Federal Court held that that there had been misleading and deceptive conduct within the meaning of section 52 of the Trade Practices Act 1974 (Cth) and ordered deregistration of the domain names. v Yoga Magik Pty Limited71 the Federal Court of Australia followed the Marks & Spencer case. 71 [2003] FCA 536. In CSR Limited v Resource Capital Australia Pty Limited. In addition. He was approached to lend his name and reputation to the promotion of several websites. stated that anyone seeing the domain name would assume that CSR was the real owner of the domain name. Jonn Mumford. (c) represent that goods or services have sponsorship. 53 A corporation shall not.70 State Fair Trading legislation contains similar provisions in relation to misleading or deceptive conduct by non corporations such as individuals. . CSR is a well-known Australia icon. in trade or commerce. Section 53 requires a form of intent.158 LAW OF ELECTRONIC COMMERCE 52(1) A corporation shall not. approval or affiliation it does not have . The defendant had previously written to another sugar company offering to sell domain 70 See Trade Practices Act 1974 (Cth) s75AZC. It produces 4 per cent of the raw sugar traded on the world market and 40 per cent of Australia’s total raw sugar. performance characteristics. in connexion with the supply or possible supply of goods or services or in connexion with the promotion by any means of the supply or use of goods or services: . The defendant registered the domain names csrsugar. also known as Swami Anandakapila Saraswati.com and csrsugar. apply for orders to rescind or modify a contract under section 87 or apply for an injunction under section 80. that person may commence an action under section 82. 72 [2003] FCA 279.72 Hill J. Where a person claims loss or damage as a result of misleading or deceptive conduct. Civil action may be based on the section. had developed a reputation with regard to yoga and Eastern spirituality. In Kailash Center for Personal Development Inc.au and wrote to CSR offering to sell the domain names. a breach of section 53(c) and (d) conduct is an offence. Section 52 applies without intent and gives rise to civil action. (d) represent that the corporation has a sponsorship. accessories.

third.73 Referring to the One in a Million case. Persons used their credit cards. His Honour expressed concern that ‘cross-border fraud and misleading conduct. para 42. there must be an identity of parties. among others. The plaintiff did not raise passing off but relied on the consumer protection provisions of the Trade Practices Act 1974 (Cth). and thereby be guilty of the tort of passing off as was held by the Court of Appeal in England. and constituted a representation that CSR and the defendant were affiliated. the court stated: a cyber squatter who registers a name intending to sell that name to the owner of a trade mark or threaten a sale to a competitor if the owner does not come up with the money may have registered the name as an instrument of fraud. his Honour held that the sole director of RCA was in breach of the equivalent provisions in Fair Trading Act 1987 (NSW). sydneyopera. the foreign court must have exercised a jurisdiction which Australian courts will recognise. Australian Competition and Consumer Commission v Chen75 demonstrates international enforceability with domain name disputes. His Honour ordered that a copy of the judgment be forwarded to the Australian domain name registration authority. 74 [2003] FCA 279. is a growing problem for the international community’. 73 A separate dispute against the defendant (RCA) dealing with www. second. The defendant was a resident of the United States and had registered. four conditions must be satisfied if a foreign judgment is to be recognised by an Australian court: first. The Australian Competition and Consumer Commission (ACCC) informed the court that it would bring the orders to the attention of the US Federal Trade Commission and request its assistance. . Further. believing they were purchasing tickets for events at the Sydney Opera House.tullochwines. Chen falsely represented that the site was affiliated with the Sydney Opera House. Hill J ordered that the domain names be transferred to CSR and restrained both the defendant and the director from registering any other domain name where ‘CSR’ appears or in connection with sugar.org. Consumer protection and law enforcement agencies have established mechanisms for international cooperation to protect consumers. The extra-territorial enforcement of federal orders is ordinarily a matter for the domestic law of the country in which the orders are sought to be enforced.74 His Honour held that ‘the act of obtaining registration’ of both domain names amounted to misleading and deceptive conduct pursuant to section 52 of the Trade Practices Act 1974 (Cth). the foreign judgment must be final and conclusive. At common law.com had been resolved before the Administrative Panel of WIPO Arbitration and Mediation Centre at the complaint of JY Tulloch Pty Ltd. Chen’s conduct was held to be misleading or deceptive or likely to mislead or deceive (in contravention of section 52) and to include misleading representations (in contravention of subsections 53(c) and (d)). 75 [2003] FCA 897. particularly through the Internet.DOMAIN NAME DISPUTES 159 names for $5000 to $10 000 for ‘introductory purposes’. The panel found that RCA acted in bad faith and that there was ‘no clearer case of cybersquatting’.

79 [1999] 1 WLR 903. Fraud Several domain name cases have raised fraud as grounds for relief. or (3) recklessly. The registrations were instruments of fraud and injunctive relief was appropriate just as much as it was in those cases where persons registered company names for a similar purpose.78 the Supreme Court of India held that domain names are business identifiers and should be protected by the law of passing off as well as by trade mark legislation. 77 See Fletcher Challenge Ltd v Fletcher Challenge Pty Ltd [1981] 1 NSWLR 196 at 204. without the plaintiff’s consent. or (2) without belief in its truth. comes from Derry v Peek:80 fraud exists ‘when it is shown that a false representation has been made (1) knowingly. 81 In Peek v Gurney (1873) LR 6 HL 377. In Marks & Spencer plc v One in a Million. Ltd. The classic statement of fraud. 374 per Lord Herschell. There is no exhaustive definition of equitable fraud.82 Lord Halsbury LC said: A person who puts forward this ‘Yorkshire Relish. and Nicholas v Borg (1986) 7 IPR 1.79 the English Court of Appeal held that the domain names registered by the defendant were instruments of fraud. but on whether the plaintiff had developed goodwill or a reputation such that the defendant’s use of the domain name. 78 (2004) (28) PTC 566 (SC).’ made as it is by the present defendants. The value of the domain names. the term ‘fraud’ also embraces conduct which falls below the standard demanded in equity. 403 Lord Cairns considered that fraud existed where there was a partial statement of fact in such a manner that the withholding of what is not stated ‘makes that which is stated absolutely false’. the court said.77 In Satyam Infoway Ltd v Siffynet Solutions Pvt Ltd. the judgment must be for a fixed debt. from the common law world. 82 [1897] AC 710. misrepresented to the public that the defendant’s business was the plaintiff’s business. careless whether it be true or not’. if based on a judgment in personam. In Powell v Birmingham Vinegar Brewing Co.76 White J approved the contention that the right to sue for passing off was not dependent upon any title to a domain name. and with an intention of threatening dishonest use by them or another. . In Hoath v Connect Internet Services. It may be true that the 76 [2006] NSWSC 158. but undue influence and unconscionability are applicable considerations.160 LAW OF ELECTRONIC COMMERCE and fourth. [1998] EWCA Civ 1272. or that there was a trade connection between them. is representing it as being a particular manufacture. their goodwill. In equity. ‘lay in the threat that they would be used in a fraudulent way’: The registrations were made with the purpose of appropriating the [plaintiffs’] property. 80 (1889) 14 App Cas 337.81 Fraud includes equitable fraud.

This thing which is put into the hands of the intended customer is not Yorkshire Relish in that sense. D2000-0003. 90 Telstra Corporation Ltd v Barry Cheng Kwok Chu. Typosquatting includes taking advantage of the accidental omission of the dot after the initial www. D2000–1259. D2000–0587. the user was automatically redirected to an online gambling website. WIPO Case No.. such as wwwdowjones. 84 Hoath v Connect Internet Services [2006] NSWSC 158.88 In 2001 Telstra Australia succeeded in forcing the transfer of the domain name telsra.com. . WIPO Case No. WIPO Case No.83 The primary relief sought by plaintiffs is the discontinuation of the use of the offending domain name. In Yahoo! Inc.89 Upon accessing the site. Reliance is placed on the fact that a percentage of accidental hits respond positively to the diversion. D2001-0434. in cases of cybersquatting it is the transfer of the domain name. Telstra previously won other domain name disputes relating to telstrashop.org. see also Lord Herschell at 715. aggravated and punitive – and have considered making an order of account of profits. para 209. emphasis added. D2001-0423.91 83 [1897] AC 710.com from a Melbourne-based typosquatter. Similarly in Eddie Bauer Inc.com and gocities. and GeoCities v Data Art85 the claimant. The defendant had registered 36 domain name variations. who owned geocities. However. Typosquatting is a variation of cybersquatting but retains the bad faith and insidious features. 89 Telstra Corporation Ltd v David Whittle. 87 (2000) eResolution AF-204. 713–14.84 Punitive damages require a separate actionable wrong. 88 Dow Jones v Powerclick Inc. the defendant would receive 1. and which it is not denied has been made exclusively by the plaintiff for a great number of years. It is not the original manufacture. Typosquatters typically register domain names which are spelling variations of existing sites that have substantial traffic. 85 WIPO Case No. an amount of traffic which would attract considerable advertising interest. gambling or recursive advertising. Even a small percentage of hits resulting from mistyping resulted in considerable traffic. WIPO Case No.com and the panel restrained its use. but it is a particular manufacture that he desires.com90 and telstra. Telstra submitted that the practice caused embarrassment and tarnished Telstra’s reputation and marks.7 million visits per month.86 The arbitration panel ordered the transfer of these bad faith registrations. 91 Telstra Corporation Ltd v Nuclear Marshmallows. v Paul White87 the misspelt domain name was eddibower. 86 Should one in a thousand visitors make the appropriate typo.com.com. The offending site often directs browsers to sites offering adult entertainment.7 billion hits in one month. Some count the accidental hits and then sell advertising in proportion to the traffic generated. had 1. Under these circumstances it is a fraud upon the person who purchases to give him the one thing in place of the other. It is not made by the person who invented it.DOMAIN NAME DISPUTES 161 customer does not know or care who the manufacturer is. courts have made awards of damages – compensatory. He wants Yorkshire Relish to which he has been accustomed. including eocities.

disputants have seized upon the tort of passing off as the most favourable judicial cause of action to resolve their conflict. However. Further reading Anri Engel. ‘Internet domain protection: A Canadian perspective’. like a coral reef. (1997) 34 San Diego Law Review 1463. The domain name system was invented in 1983. . Domain name disputes is one such area. The English Court of Appeal moulded and fashioned the tort in a manner not previously anticipated or expected. to do just this in order to serve law and society. Rush. it is in the spirit of evolving law. (1932) 35 Harv LR 479. 92 As in the Marks & Spencer case above.(2004) Syd L Rev 9. and in his turn left a foundation upon which his successors might work’. ‘Trade marks and language’.92 The result may be classified as a new tort. (1997) 11 IPJ 1. there are several unusual and unique circumstances requiring law makers and law enforcers to rethink and reconceptualise their field. To paraphrase Learned Hands. the internet or cyberspace can be satisfactorily addressed and resolved using traditional established legal principles. But even then. the traditional and strict approach required by the judiciary fails to provide a remedy in all situations. from the minute accretions of past individuals.162 LAW OF ELECTRONIC COMMERCE Conclusion Most problems and conflicts involving electronic commerce. ‘Pursuing domain name into uncharted waters: Internet domain names that conflict with corporate trade marks’. (2003) 25 EIPR 351. of whom each built upon the relics which his predecessors left. Megan Richardson.93 New and novel creations such as domain names call to the judiciary. Andrea F. Adrian Wolff. and indeed debate continues about whether or not a domain name should be considered a new form of intellectual property. In Australia the Trade Practices Act 1974 (Cth) provides a generalist remedy adopted in some domain name cases. ‘International domain name disputes: Rules and practice of the UDRP’. or at least a subset known as ‘domain name passing off ’. 93 Billings Learned Hand’s review of Cardozo’s ‘The Nature of the Judicial Process’. The common law and statutes did not anticipate this new form of business identifier. However. as custodians of the common law. This kind of modification is not new. common law ‘stands as a monument slowly raised. In other cases an allegation of fraud can be made.

The legal proceedings in court were slow. In 1999 ICANN issued its Uniform Dispute Resolution Policy (UDRP)1 as an alternative to legal proceedings before courts. .biz. . court action. It is intended to also discourage abusive registrations. and that the registrant has registered and used the domain name in bad faith. but this process was too slow and would not be all-encompassing. .museum.org/udrp. 1 See www.coop. expensive and involved a minefield of jurisdictional issues. The UDRP has been adopted by all ICANN-accredited registrars in the gTLDs . 2 In addition. .icann. There were moves to put in place an international treaty. .aero. . .mobi.name.10 Uniform domain name dispute resolution policies By the 1990s. .jobs.com. ICANN has issued a number of specialist policies for particular TLDs. . suspend. The UDRP has become the international standard for resolving domain name disputes.org. which largely reproduce the ICANN policy. This chapter deals with the dispute resolution policies of ICANN and selected national domain name administrators. ICANN was in need of a solution to the rising dispute resolution problem.net.pro. .2 ICANN provides that domain name disputes must be resolved by agreement. a significant number of domain name administrators have issued their own Dispute Resolution Policies. See below.tel and .info. 163 . However. that the registrant does not have a right or legitimate interest in the domain name. .travel. It does not extend to any domain name ending with a country code: these are separately administered. . The complainant is required to demonstrate that the disputed domain name is identical or confusingly similar to theirs. or transfer a domain name. or arbitration before a registrar will cancel. . the result could well be a plethora of divergent responses. The US legislative solution in 1999 was only a partial solution and few jurisdictions expressed the need to follow their lead.cat.

164 LAW OF ELECTRONIC COMMERCE The UDRP operates as a contractual term between the registrar and its customer and is included in all registration agreements. It is a forum for the development and implementation of intellectual property policies internationally. but can also be between two legitimate traders. but the Final Report recommended that the administrative procedure be limited to cases of bad faith. The Final Report recommended that ICANN adopt a dispute resolution policy with a uniform procedure for domain name disputes in all gTLDs.org. The mechanism would be akin to the special protection established for famous and well-known marks in the Paris Convention for the Protection of Industrial Property and the TRIPS Agreement. cybersquatters also register close variations of the mark. the World Intellectual Property Organisation (WIPO) conducted extensive consultations with the internet community and published a report containing recommendations in relation to domain name issues.wipo. WIPO internet domain name reports At the instigation of concerned member nations. this is called typosquatting. and would cover only the exact name of the mark. WIPO promotes the protection. with 183 member states. WIPO recommended that there should be ‘Exclusions for Famous and Wellknown Marks’: marks that exist over a widespread geographical area and across different classes of goods or services. cost-effective and conducted to a large extent on-line’. . The Interim Report had recommended that applicants should be required to submit any intellectual property dispute arising out of their application. Disputes alleged to arise from abusive registrations of domain names may be addressed by proceedings initiated by a complaint and brought before an approved dispute-resolution service provider. intergovernmental organisations. An evidentiary presumption should arise which would place the burden of proving justification for the use of the domain name at issue on the domain name holder where the 3 For the latest particulars see www. professional associations. through treaties and other policy instruments. The procedure is intended to be ‘quick. and its remedies are limited to orders for the cancellation or transfer of domain name registrations and the allocation of the costs of the procedure (excluding legal fees) against the losing party. corporation and individuals. However. The investigation included a detailed review of the Administrative Procedure Concerning Abusive Domain Name Registrations. It was founded by treaty. dissemination and use of intellectual property throughout the world for economic. efficient. These disputes may involve cybersquatting.3 The WIPO domain name process involved 17 consultation meetings in 15 cities and the receipt of written submissions from 334 governments. cultural and social development.

effective on 1 December 1999. . . including Geographical Indications (such as wine-producing regions) and personality rights (such as the names of celebrities).net.cat.tel and .6 Dispute proceedings arising from alleged abusive registrations of domain names may be initiated by parties claiming trade mark or service mark rights. The ease of registering these identifiers as domain names is a consequence of the first-come.travel. The issues to be addressed included bad faith and abusive domain name registrations that violate: (1) intellectual property rights. or the names of countries. scientific or religious persons. . by parties with no association at all.coop. The Disputes. Some registrations offend many sensitivities – the registration of the names of eminent political. The WIPO report resulting from this process found considerable evidence of the registration and use of identifiers as domain names by persons who might be considered not to be properly entitled to use the identifiers in question.5 effective on 28 February 2002. first-served system of registration (see Chapter 9). . The 2nd WIPO Internet Domain Name Process began in August 2000. . so as to protect patient safety worldwide. The UDRP has been adopted by ICANN-accredited registrars in all gTLDs: it is included as a term in registration agreements between the applicant and the registrar.com.info. cities or indigenous peoples. Hong Kong and Seoul.jobs.4 WIPO became the first. . . . . effective on 23 December 1999. and the Asian Domain Name Dispute Resolution Centre (ADNDRC).biz. .mobi. . 6 In the domains . reduce the costs for resolving domain name disputes and enable the laws of nation states to continue to operate.aero. The National Arbitration Forum (NAF).UNIFORM DOMAIN NAME DISPUTE RESOLUTION POLICIES 165 domain name is identical or misleadingly similar to the famous or well-known mark.org. were the other two. UDRP rules There were three approved dispute resolution providers at first. The CPR Institute for Dispute Resolution accepted domain name disputes from June 2000 until January 2007. On 16 October 2000 the approval of DeC was transferred to eResolution (eRes).org/eResolution consortium (DeC) was approved on 1 January 2000. (2) the names and acronyms of international intergovernmental organisations (such as the United Nations). 5 Offices in Beijing. (3) International Nonproprietary Names set down by the World Health Organisation for pharmaceutical substances.pro. for instance. The purpose of the URDP is to create global uniformity. . . and (4) unfair competition law and the rights established under international treaties.museum. On 30 November 2001 eResolution ceased accepting proceedings. In applying for an ICANN open domain name the registrant must represent and warrant that the statements made in the application are complete and accurate 4 There have been other approved dispute resolution providers which have ceased to provide services. .name.

com10 or ‘girls’ is added to ‘nokia’ to form nokiagirls.7 The numerous examples of cybersquatting are a testament to the fact that a considerable number of registrants ignore this contractual undertaking. The UDRP’s administrative panel’s decisions cannot be enforced in court. Clearly there are examples of well-known and famous trade marks being registered without there having been any attempt to question or otherwise limit the applications. for example.11 In the latter case the WIPO panel stated. ‘The addition of . WIPO Case No. the WIPO panel made the somewhat obvious statement. WIPO Case No.com. . ‘The ability of this word “girls” to distinguish the Domain Name from the trademark of the Complainant is limited. 10 Toyota Jidosha Kabushiki Kaisha v S & S Enterprises Ltd. . in compliance with the Rules of Procedure. and there is little need for analysis. Identical or confusingly similar Many cases simply involve the exact trade or service mark of the complainant. 9 WIPO Case No. D2000–0802.nz.9 the registrant had registered robohelp.com.au. for their income.com is not a distinguishing difference. As a general noun. Inc. which was identical to the complainant’s trade mark ‘ROBOHELP’. ‘i’ is added to ‘Toyota’ to create itoyota. that (i) your domain name is identical or confusingly similar to a trademark or service mark in which the complainant has rights. On occasion parties have attempted to argue that the use of an identical identifier 7 It should be reiterated that the UDRP applies to the open gTLD and not directly to any of the approximately 240 country code domain names. to the applicable Provider. there is little scrutiny or examination required when.uk and . The majority of the national domain name administrators have incorporated parallel if not identical rules into there own domain name agreements. In Blue Sky Software Corp. 11 Nokia Corporation v Nokiagirls. such as . . so restricting registration would be an additional cost and thus against their own interests. WIPO Case No. 12 See also The Stanley Works and Stanley Logistics Inc. The registrant further declares that the domain name will not be used for an unlawful purpose and that the domain name will not knowingly be in violation of any applicable laws or regulations. “girls” is indeed a rather neutral addition to this trademark. . D2000–0165. D2000–0102. 8 UDRP.. ICANN makes no attempt to require its registrars to make any determination about whether the applicant may be in breach. Registrants are required to submit to a mandatory administrative proceeding in the event that a third party makes a complaint: .’ Similarly.’12 The words ‘identical or confusingly similar’ are meant to be separate concepts. First. D2000– 0113.8 The complainant must prove that all three elements are present. and (iii) your domain name has been registered and is being used in bad faith.us.166 LAW OF ELECTRONIC COMMERCE and that to the registrant’s knowledge the registration does not infringe upon or violate the rights of any third party. and (ii) you have no rights or legitimate interests in respect of the domain name. .in. Registrars often rely. paragraph 4(a). v Digital Sierra Inc. v Camp Creek Co. on turnover of domain names.com. .

19 autotradersucks.UNIFORM DOMAIN NAME DISPUTE RESOLUTION POLICIES 167 should be identical and confusingly similar. The WIPO panel rejected the registrant’s argument that an identical domain name must simultaneously be confusingly similar for the provision to become operative: The burden on the Complainant under this head is merely to demonstrate that the disputed domain name is similar or identical to the Complainants’ trademark. D2000–1104. 14 WIPO Case No. D2000–0662. WIPO Case No. WIPO Case No. WIPO Case No. D2001–1195.com21 and wal-martsucks. para 6. In a majority of cases the panels have concluded that the domain names were confusingly similar: for example. D2000–0636 (natwestsucks.com24 and lockheedmartinsucks. D2001–1195. 15 Wal-Mart Stores Inc. 23 Wal-Mart Stores Inc.18 accorsucks. without reference to the way in which the domain name is being used. 25 Lockheed Martin Corporation v Dan Parisi. Plainly enough. 19 Soci´t´ Accor contre M Philippe Hartmann. D2001–0213.com).com.15 salvationarmysucks.com and Kenneth J Harvey. WIPO Case No.22 However.20 standardcharteredsucks. v NABR13 involved a well-known brand of cigarettes – Kool – and the registration of kool. and Vivendi Universal v Jay David Sallen. The panel does not need to consider other trade mark or passing off considerations.16 guinness-reallysucks.com. v wallmartcanadasucks.com.. v Fred Craig. WIPO Case No. WIPO Case No.com). National Westminster Bank PLC v Purge IT.com. 27 WIPO Case No.28 13 WIPO Case No. 24 McLane Company Inc. D2001–1480. and British American Tobacco (Brands) Inc. D2000–0584 (dixonssucks.com). 28 WIPO Case No. D2001–1480. D2001–1121 (vivendiuniversalsucks.com.25 The panels have considered a ‘mark for name comparison’. WIPO Case No.com. 18 ADT Services AG v ADT Sucks.com.com. The case of BWT Brands Inc. v AFX Communications. WIPO Case No. Dixons Group PLC v Purge IT. See also Direct Line Group Ltd v Purge IT. 16 The Salvation Army v Info-Bahn Inc.com). The panel stated: Not all Internet users are English speaking or familiar with the use of ‘sucks’ to indicate a site used for denigration.com). D2000–0681. it is not unknown for companies to establish complaint or comment sites or areas of sites to obtain feedback on their products. Furthermore. D2000–1778. some people might suppose that a website of this nature at the Domain Name was operated by the Complainant.com was confusingly similar to the trademark ‘Philips’. D2000–0996. D2000–0585 (freeservesucks. 17 Diageo plc v John Zuccarini. the disputed domain name kool. D2000–0583 (directlinesucks.com. walmartcanadasucks. D2000–0477. WIPO Case No.26 While actual deceptive use is relevant to the second and third requirements. ee 20 TPI Holdings Inc. the opposite conclusion was reached with wallmartcanadasucks. This involves the potential and the actual use of the domain name for confusion. WIPO Case No. D2001–0007. v Walsucks and Walmarket Puerto Rico. it is not for the first requirement. D2000–1455. WIPO Case No. D2000–1015. . para 6.com. WIPO Case No. v Richard MacLeod. 22 Wal-Mart Stores Inc. D2000–1472. accordingly. WIPO Case No. 21 Standard Chartered PLC v Purge IT. Freeserve PLC v Purge IT. In Koninklijke Philips Electronics NV v In Seo Kim27 the panel considered that phillipssucks. D2001–0463. WIPO Case No.14 The test of confusing similarity is limited to a comparison between the domain name identifier and the mark alone.23 mclanenortheastsucks. WIPO Case No. 26 See Koninklijke Philips Electronics NV v Cun Siang Wang.17 adtsucks. WIPO Case No. WIPO Case No.com is identical to the Complainant’s registered trademark.com.

so panels are not bound by them.com Inc. Trade mark or service mark The ICANN rules fit the US concept of common law trade mark and service marks much more neatly than they do the laws of other jurisdictions. . D2001–1121. Nevertheless. FA0096364.com)32 the registrant used the misspelling to direct users to another website. WIPO Case No. that sucks. WIPO Case No. 31 See Sony Kabushiki Kaishal v Sin Eonmok. not free speech. The panel held that the domain name was confusingly similar to the trade name ‘Eddie Bauer’. independent of the other marketing and use factors usually considered in a traditional infringement action’. The extended meaning of ‘service mark’ has been used to deal with unregistered marks which might otherwise fit within the US approach.com.com will not necessarily result in a successful challenge. D2001–1195. WIPO Case No. the second and third requirements of the rule will not necessarily be met. v Paul White (edibower. v Sander. v Kremer 403 F. Three panel decisions have included dissenting opinions on this issue. para 6. dealing with the addition of ‘my’. Critics have argued that the domain name rules are against free speech. Many jurisdictions define trade marks as the exclusive purvey of trade mark legislation. 33 For example. but not identical’ to the complainant’s mark. v Your Energy Source30 the domain name was yourenergysource.31 In Eddie Bauer Inc. stating that it is ‘undoubtedly similar.com sites are legitimate forms of free expression. See also Bosley Medical Institute Inc. 29 WIPO Case No. Panels have noted that the UDRP is directed against abusive registration.33 However. D2000–0579.. ‘Energy Source’. and panels refer to such decisions in their reasons for judgment.29 Registrants often argue that the identifier is made up of generic or descriptive words which are not exclusively associated with complainant’s mark or business. 30 NAF No. the panel rightly stated that the addition of sucks. 32 (2000) eResolution AF-204. parties before panels do refer to earlier decisions. The panel said that ‘confusing similarity should be determined by comparing the mark and domain name alone.168 LAW OF ELECTRONIC COMMERCE However. The application of these principles continues to prove problematic. where clothing similar to the complainant’s was offered for sale. In Energy Source Inc. Vivendi Universal v Jay David Sallen and GO247. The panel regarded the words ‘energy source’ as the salient feature and determined that the addition of ‘your’ would be likely to be regarded by internet users as something related to ‘energy source’. The three-member panel focused on the domain name itself. 3d 672 (9th Cir 2005). the decisions of panels do not form precedents in the formal sense. Where a domain name is genuinely registered and used for the purposes of criticism. D2000–1007 and MP3.com Inc.

See also PA Consulting Services Pty Ltd v Joseph Barrington-Lew. FA0001000092054.38 The registrant. The well-known singer and performer Madonna challenged Dan Parisi. . The panel stated that the ‘Complainant does not rely upon any registered trade marks but on her common law rights in her real name’. WIPO No. 35 The Panel referred to Coca-Cola v F Cade & Sons Limited [1957] IR 196. The panel held that the complainant’s mark. She has achieved international recognition and critical acclaim for her works and ‘use of that Mark has come to be recognised by the general public as indicating an association with words written and produced exclusively by the Complainant’. However. for the purposes of the panel decision. Hogarth. For example. as was her mother and hundreds of thousands of other people throughout the world over the past 2000 years. representing the Dutch state. even though in the Netherlands no common law trade mark exists. This Irish based case referred to local trade mark law. v Fiber Shield Ltd (fibershield.UNIFORM DOMAIN NAME DISPUTE RESOLUTION POLICIES 169 Common law trade mark rights are usually confined to the jurisdiction where the mark is used.35 In Fiber-Shield Industries Inc. The panel resolved the dispute in favour of the complainant.net). D2001–0520. DAU2003–0002. who purchased madonna.37 the complainant alleged that there was a common law mark Staten-Generaal (States General). However. D2000–0600. and that the complainant might thus be viewed as having legally protectable rights. and had no greater right than any other person so named. was a research fellow at Cambridge University and claimed that he intended to develop websites with reviews. 38 See Jeanette Winterson v Mark Hogarth. 37 WIPO Case No. The panel was satisfied that Jeanette Winterson had established trade mark rights in the mark for the purpose of the UDRP and ordered that all three domain names be transferred. as well as within the Netherlands. D2000–0235. 36 NAF (2000) No. Staten-Generaal. Case No. well-known novelist Jeanette Winterson reclaimed her name.com for US$20. was reasonably well known throughout the world.000. The panels have ruled that registration as a registered trade mark or service mark was not necessary. though there was a trade mark application pending in respect of other marks.net).com (as well as . which hitherto had not recognised common law trade marks. Hogarth also has stated that he wanted to make money.. the respondent had operated a legitimate. Parisi argued that this complainant was named after the Virgin Mary. This complainant 34 WIPO Case No. which had been registered as Jeanettewinterson. noncompeting business under the name for more than 10 years but had nevertheless lost the domain registration.36 In State of the Netherlands v Goldnames Inc. the identifier was identical. and that even individual names have sufficient secondary association for complainants to maintain that ‘common law trademark rights’ exist.org and . Parisi had no legitimate interest in the name and he had acquired it and was using it in bad faith. biographies and forthcoming works of authors. and had asked for a 3 per cent share of profits of books sold via the website. In ESAT Digifone Ltd v Colin Hayes34 the complainant had failed to register its own name.

with a number of different meanings. WIPO Case No. WIPO Case No.49 a trade mark application was filed for www. Mick Jagger. WIPO Case No. failed in his attempt. Sting v Michael Urvan. but the complainant did not provide any documentary evidence in support of his assertion that he was the owner of the unregistered trademark or service mark. 45 The Ian Anderson Group of Companies Ltd v Denny Hammerton. emphasis added. WIPO Case No. The applicant used the mark on letterheads and business cards. 43 Isabelle Adjani v Second Orbit Communications Inc. WIPO Case No.com. The singer had had ‘continuous commercial use of that mark for more than thirty-five (35) years’. These contentions were rejected by the USPTO Trademark Trial and Appeal Board. The claim was made that by not including the prefix http://. (madonna. D2000–0596. 39 Madonna Ciccone v Dan Parisi.48 In Re Eilberg. another well-known singer.42 Isabelle Adjani.40 The panel stated that the UDRP ‘does not require that the Complainant have rights in a registered trademark or service mark’ and decided that the complainant held a common law trademark in his famous name. 40 Mick Jagger v Denny Hammerton. NAF FA0095261. D2000–0210. The complainant did assert – and the panel took the equivalent of judicial notice – that the complainant is a world-famous entertainer known by the name Sting. WIPO Case No. the personal name in this case is also a common word in the English language. However. Time Warner has been successful in seeking orders to have several domain names which include the fictitious name ‘Harry Potter’..44 Jethro Tull45 and Jimi Hendrix. D2000–0364. On the other hand. 44 The Wiggles Touring Pty Ltd v Thompson Media Pty Ltd.43 the Wiggles.com).com in the class of intellectual property. D2000–0124.170 LAW OF ELECTRONIC COMMERCE had registered ‘Madonna’ as a trade mark. D2000–0867. the use operated as a trade mark rather than merely as an indicator of a way to contact the law firm. WIPO Case No. 49 49 USPQ 2d 1955 (1998).com. referring to the musical group. establishing her rights in the name. Sting v Michael Urvan. 42 Julia Fiona Roberts v Russell Boyd. the capitalisation and spacing. D2000–0596. . the panel stated: Although it is accepted that the Complainant is world famous under the name STING. . Experience Hendrix LLC v Denny Hammerton and The Jimi Hendrix Fan Club.46 In addition. D2000–0847. The panel first noted that the domain name was identical except for the .41 Other celebrities who have succeeded in having their name transferred include Julia Roberts. 41 Mick Jagger v Denny Hammerton. . 46 By the estate of the late Jimi Hendrix. it does not follow that he has rights in STING as a trademark or service mark .eilberg. 48 Gordon Sumner. after considering the fact that this identifier has common dictionary meanings. WIPO Case No. Sting. 47 Gordon Sumner.47 In the Sting case the panel agreed that unregistered or common law marks are sufficient.39 In a not dissimilar case the registrant had registered the domain name mickjagger. It held that displaying the domain name on the letterhead did not function as a service mark. NAF FA0095261. D2000–0475.

50 UDRP paragraph 4(a)(ii) provides the second of three assertions by the complainant: ‘the registrant has no rights or legitimate interests in respect of the domain name’. In relation to 4(c)(i).com. . business. to misleadingly divert consumers or to tarnish the trademark or service mark at issue.52 In relation to paragraph 4(c)(i). The panel held that the mere assertion of making preparations to use the domain name for the bona fide offering of goods is insufficient to demonstrate rights or legitimate interests. almost legendary.com) the registrant argued that the complainant’s trade mark ‘libro’ is common Spanish and Italian word for ‘book’. D2000–1532. or other organization) have been commonly known by the domain name. The title to the paragraph is ‘How to Demonstrate Your Rights to and Legitimate Interests in the Domain Name in Responding to a Complaint’:51 4(c) Any of the following circumstances . in fact users were redirected to restaurants. The panel is free to make reasonable inferences. The panel described Bruce Springsteen as ‘the famous. 51 The terms ‘your’ and ‘you’ refer to the registrant. D2000–0186. . When accessing the website users were immediately transferred to celebrity1000.54 both the complainant and the registrant had rights in the name. in Libro Ag v NA Global Link53 (libro. 53 WIPO Case No. However. the panel found there was no bona fide commercial use. with Jeff Burger as the point of contact. without intent for commercial gain. Paragraph 4(c) of the UDRP sets out specific circumstances to assist the registrant in demonstrating legitimate rights or legitimate interests in the domain name.com. shall demonstrate your rights or legitimate interests to the domain name for purposes of Paragraph 4(a)(ii): (i) before any notice to you of the dispute. 52 UDRP paragraph 4(c). his name is instantly recognisable in almost every part of the globe’ and accepted the complainant’s common law rights in the name. even if you have acquired no trademark or service mark rights. or demonstrable preparations to use.UNIFORM DOMAIN NAME DISPUTE RESOLUTION POLICIES 171 Registrant has no rights or legitimate interests The second limb of the UDRP50 requires the complainant to show that the registrant has no rights or legitimate interests in the domain name. . In Bruce Springsteen v Jeff Burgar and Bruce Springsteen Club. The circumstances are inclusive and useful in considering this issue. The mere assertion that the respondent has no such rights does not constitute proof. or (ii) you (as an individual. . or (iii) you are making a legitimate noncommercial or fair use of the domain name. 54 WIPO Case No. . recording artist and composer . your use of. the domain name or a name corresponding to the domain name in connection with a bona fide offering of goods or services. The registrant was the Bruce Springsteen Club. although the registrant claimed it had registered the domain name to establish an online virtual book store.

com via the name ‘Bruce Springsteen’. let alone ‘commonly’ recognised in that fashion. Any of the following circumstances. provided that you have engaged in a pattern of such conduct. or (ii) you have registered the domain name in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name. or (iii) you have registered the domain name primarily for the purpose of disrupting the business of a competitor. Bruce Springsteen. . Due to the number of sites. the panel considered the meaning of ‘non-commercial’ and ‘fair use’. they stated that ‘it is hard to infer from the conduct’ of the registrant that the intent was for commercial gain or ‘to misleadingly divert consumers’. The circumstances include dealing with cybersquatting and the attempted extortion from trade mark and service mark owners: 4(b) . D2000–1532. Accordingly. Accordingly the panel found that this requirement too was not met. Registration and use in bad faith The UDRP rules provide an explanation of ‘Registration and Use in Bad Faith’. They considered that fair use would not exist if the domain name in question connected. if found by the Panel to be present. . in particular but without limitation. renting. for example. from which it would be apparent to users that some sites were official or authorised sites and others were not. to ‘sites containing pornographic or other regrettable material’. In determining that such conduct does not ‘tarnish’ the common law rights of Bruce Springsteen by association with the celebrity1000. the panel found there was ‘fair use’.com website. .172 LAW OF ELECTRONIC COMMERCE In relation to 4(c)(ii). would yield thousands of hits. or 55 WIPO Case No. the panel considered the meaning of ‘commonly’ and ‘known by’. the panel noted that users would be ‘unsurprised’ to arrive at celebrity1000. for valuable consideration in excess of your documented out-of-pocket costs directly related to the domain name. It found that the use of the name ‘Bruce Springsteen Club’ would not give rise to an impression in the minds of internet users that the proprietor was effectively ‘known as’ Bruce Springsteen. shall be evidence of the registration and use of a domain name in bad faith: (i) circumstances indicating that you have registered or you have acquired the domain name primarily for the purpose of selling.55 The panel found that the complainant. had not satisfied the second limb of of the three-part test in paragraph 4(a) of the UDRP. In applying 4(c)(iii). It observed that ‘Bruce Springsteen’. when inputted into a search engine. or otherwise transferring the domain name registration to the complainant who is the owner of the trademark or service mark or to a competitor of that complainant. para 6.

v William E. Visit to the relevant websites might reveal the parties’ compliance with the rules. 58 UDRP paragraph 4(k). a plaint file-stamped by the clerk of the court. or endorsement of your web site or location or of a product or service on your web site or location.63 56 UDRP paragraph 4(b). 60 Case No. D2000–0756. affiliation. D2000–0005 and Telaxis Communications Corp. DAU2002–0001. or satisfactory evidence that the legal proceedings have been dismissed or withdrawn. 59 See UDRP clause 4(d)–(k). This is to allow the registrant the opportunity to commence legal proceedings. their state of mind in relation to such issues as bad faith. Internet users to your web site or other on-line location. where the panel stated that it is not ‘the burden of the Panel to seek further evidence (other than judicial knowledge) to sustain the parties’ allegations. or a copy of an order from the court dismissing the legal proceedings or ordering that the registrant has no right to continue to use the domain name. for commercial gain. AF-0807. by creating a likelihood of confusion with the complainant’s mark as to the source.62 Another took the view that the panel is entitled to have regard to any freely available online public material ‘germane to an issue in dispute’.’ 63 Case No. WIPO Case No. The UDRP’s mandatory administrative proceeding requirements do not prevent legal proceedings in any court of competent jurisdiction from being commenced before or after the UDRP proceedings. WIPO Case No. Minkle. 57 See Miele Inc. DAU2002–0001. sponsorship. and the validity of their respective submissions.59 In GlobalCenter Pty Ltd v Global Domain Hosting Pty Ltd60 the panel members considered their right to make independent investigations. para 6. All panel decisions under the UDRP are published in full on the internet. the burden rests on the parties to either support or sustain their allegations with the appropriate documentation whenever possible.57 The remedies available to the complainant pursuant to any proceeding before the panel are the cancellation of the domain name or the transfer of the domain name to the complainant. 61 Rules for UDRP rules 10(a) and 15(a). v Absolute Air Cleaners and Purifiers. as this may be disruptive of the arbitration process. The UDRP decision will not be implemented until ICANN receives: satisfactory evidence of a resolution between the parties. the panel can determine to withhold portions in exceptional circumstances. All that is required to do this is notice of the legal proceedings by. Michelle McKinnon v Rennemo Steinar eResolution. Therefore.58 The UDRP allows a period of grace of 10 business days before taking action on any decision to cancel or transfer the domain name.UNIFORM DOMAIN NAME DISPUTE RESOLUTION POLICIES 173 (iv) by using the domain name.56 These rules encompass and go beyond typical cybersquatting and typosquatting situations. for example. One took the view that the UDRP rules61 preclude panel members from conducting their own factual investigations and from visiting relevant websites unless invited by a party to the dispute. . you have intentionally attempted to attract. 62 See also Jazid Inc. Case No.

it shall so state.htm. (d) The Panel shall determine the admissibility. D2000–0004.org/en/udrp/udrp-rules-24oct99. Rules for UDRP rule 13. these Rules and any rules and principles of law that it deems applicable. . the Panel shall forward its decision on the complaint to the Provider within fourteen (14) days of its appointment pursuant to Paragraph 6. (e) A Panel shall decide a request by a Party to consolidate multiple domain name disputes in accordance with the Policy and these Rules.icann. WIPO Case No. a period of time fixed by these Rules or by the Panel. for example in an attempt at Reverse Domain Name Hijacking or was brought primarily to harass the domain-name holder. (d) The Panel’s decision shall be in writing. materiality and weight of the evidence. (c) The Panel shall ensure that the administrative proceeding takes place with due expedition.66 In Mary-Lynn Mondich and American Vintage Wine Biscuit Inc. the Panel’s decision shall be made by a majority.67 the panel held that merely offering to sell the domain name to owner of the trade mark can be sufficient evidence for registration and use in bad faith where the registrant claimed more than any underlying costs. Any dissenting opinion shall accompany the majority decision. where 64 65 66 67 Available at: www. (b) In all cases. It may. On occasion proceedings may be by teleconference. (b) In the absence of exceptional circumstances. in exceptional cases. If after considering the submissions the Panel finds that the complaint was brought in bad faith. The general power of the panels are: 10(a) The Panel shall conduct the administrative proceeding in such manner as it considers appropriate in accordance with the Policy and these Rules. the Panel shall ensure that the Parties are treated with equality and that each Party is given a fair opportunity to present its case. method and form of the panel’s decision. v Big Daddy’s Antiques. indicate the date on which it was rendered and identify the name(s) of the Panelist(s). However. and about how it deals with dissenting opinions and with bad faith complaints: 15(a) A Panel shall decide a complaint on the basis of the statements and documents submitted and in accordance with the Policy. the Panel shall declare in its decision that the complaint was brought in bad faith and constitutes an abuse of the administrative proceeding. (c) In the case of a three-member Panel. relevance. If the Panel concludes that the dispute is not within the scope of Paragraph 4(a) of the Policy.174 LAW OF ELECTRONIC COMMERCE The proceedings before panels are governed by the Rules for the UDRP. at the request of a Party or on its own motion. (e) Panel decisions and dissenting opinions shall normally comply with the guidelines as to length set forth in the Provider’s Supplemental Rules.64 These rules deal with the procedure and aspects such as fairness and evidentiary standards.65 There are also rules concerning the timing. Rules for UDRP rule 15. videoconference or web conference. extend. provide the reasons on which it is based.

D2000–0003 (Telstra. However. D2000–0004 (cityutilities. (2000) NAF 93682 (cartoys.net). legal or otherwise. complainants have no time restriction when they prepare an application. See also Blue Cross and Blue Shield Association and Trigon Insurance Company v Interactive Communications Inc. Critics also argue systemic bias in the results. research precedents and procedures. D2000–0788.UNIFORM DOMAIN NAME DISPUTE RESOLUTION POLICIES 175 the complainant initiated transfer discussions and the registrant had no prior plans to sell the domain name. WIPO Case No. Alternatively. the high percentage of decisions in favour of the complainant can be explained in part by three underlying factors. .. it may be evidence of the extent of cybersquatting and bad faith use. it has been recognised as a factor in proving of bad faith. the reasons for engaging in the expeditious UDRP 68 See City Utilities v Ed Davidson.org).com).68 Where the registrant concealed their identity by operating under a false name the panel can find bad faith. WIPO Case No. (2000) NAF 94355 (daf. There is only one bite at the cherry. WIPO Case No.70 but in others. 72 With an additional payment of US$250. This may be a disturbing consequence of the swift process. the panel can find no bad faith.com). It is most likely to be a combination of the two. Third. The first is the effect on these figures of the number of default cases. while the reasons for commencing legal proceedings are in general many and varied. WIPO Case No. v Informa Unlimited. Second.com). The Rules for UDRP stipulate that a respondent has 20 days to file a response. with the average time to resolve disputes 37–45 days.org).72 The large number of disputes constitutes a tempting market for dispute resolution providers. such as Microsoft Corporation v Amit Mehrotrata71 (Microsoft. distributing press releases about its decisions. but the breakneck pace of the dispute resolution process will leave many legitimate registrants intimidated and wary. This means that half of the thousands of cases are decided on the basis of the complainants’ assertions only. 71 WIPO Case No. There are no appeals. D2000–0053. and Allocation Network Gmbh v Steve Gregory. which are often pro complainant. approximately half the total number of applications go unanswered. UDRP process The advantage of avoiding the court system – cutting down on the number of times the case may be run – is sometimes regarded as a drawback. NAF markets its services prominently. NAF now permits additional written submissions within five calendar days of the respondent’s response. Philippe Tenenhaus v Telepathy Inc. There has been a considerable amount of abuse by registrants. then draw up and file a response.69 In a few cases the sale of domain names has been considered a legitimate interest. obtain expert opinion. 69 See Telstra Corporation Ltd v Nuclear Marshmallows. Because this is not sufficient time to consider a course of action. Decisions are typically made in a timely manner. 70 See Car Toys Inc. Inc. D2000–0016 (allocation.

auDA adopted the . The applicant can choose a panel of one or three members. the former provider eResolution not only had a lower success rate for the complainants but also a higher percentage of contested disputes.176 LAW OF ELECTRONIC COMMERCE process are more likely to be a sincere and greater belief of success. The two most popular providers have been WIPO and NAF. These decisions seem to have involved the consideration of elements absent from the rules: they have recognised established rights in the relevant identifier. .au. It is not likely to be a coincidence that both these providers have more positive outcomes for applicants than for respondents.au Dispute Resolution Policy (auDRP) in 2002. This policy is modelled on the UDRP and applies to all open 2TLDs. However. Interestingly. with 58 per cent and 34 per cent respectively. The process is thus self-selecting.au. Statistics show that three-member panel decisions are more often favourable to the applicant. Most require the same or similar three elements to be established.au. This interpretive twisting has encouraged forum-shopping by complainants and promoted a bias toward large trade mark holders. in compliance with the Rules of Procedure that: 73 See International Trade Mark Association (INTA) Internet Committee reports: www. and sometimes by usage. id. WIPO and NAF share the majority of the applications. com. but the panel has nevertheless found reason to order a cancellation or transfer.au. The results have been analysed and interpreted from a number of points of view. Yet there have been cases where elements two and three are absent or questionable. auDRP In Australia the Australian Domain Name Administrator. net.org. ccTLD dispute resolution policies A significant number of domain name administrators have implemented domain name dispute resolution policies based on the UDRP. It seems that dispute resolution providers that recognise these additional non-specified rights receive a greater share of the lucrative market. The relevant provisions state: You are required to submit to a mandatory administrative proceeding in the event that a third party (a ‘complainant’) asserts to the applicable Provider.73 The application of the three elements to make a finding should be a simple and uncomplicated exercise. namely asn. claiming bias on the basis of statistics only is injudicious. All three elements must be present. A few use related principles.inta. sometimes by trade mark.au and org. Some may argue inherent bias in this too. The success rate for applicants is 82 per cent and 83 per cent respectively. but again the process may be self-selecting – perhaps those with a greater confidence choose the larger panel. registered or otherwise.

Circumstances indicating that the Respondent has registered or otherwise acquired the Domain Name primarily: (a) for the purposes of selling.nz domains).nz DRSP The registry responsible for the . renting or otherwise transferring the Domain Name to the Complainant or to a competitor of the Complainant.1–5.UNIFORM DOMAIN NAME DISPUTE RESOLUTION POLICIES 177 (i) your domain name is identical or confusingly similar to a name.74 There are three differences between the provisions of the UDRP and those of the auDRP. Under the auDRP no such pattern is required. Third. and (ii) you have no rights or legitimate interests in respect of the domain name. It is similar to the . and The National Office for the Information Economy v Verisign Australia Limited LEADR. Case No. and the complainant’s personal name. This includes the complainant’s company. not only to a trademark or service mark. University of Melbourne v union melb. in paragraph (iii) the word ‘and’ has been replaced with ‘or’. The Complainant has Rights in respect of a name or mark which is identical or similar to the Domain Name. The auDRP applies to domain names that are identical or confusingly similar.5: 5. it is sufficient to prove that either registration ‘or’ subsequent use of the domain name by the registrant occurred in bad faith.1: 5. . for valuable consideration in excess of the Respondent’s 74 auDRP clause 4(a). as registered with the relevant Australian government authority. Case No. the auDRP added ‘name’.uk DRSP. but also to any ‘name’ in which the complainant has rights.2 The Domain Name. 76 New Zealand DRSP clause 4.1. DAU2004–0007.1.75 . and (iii) your domain name has been registered or subsequently used in bad faith.76 An ‘Unfair Registration’ is set out as non-exclusive circumstances in paragraph 5. in the hands of the Respondent.nz (New Zealand) domain name extension instituted a new Dispute Resolution Service Policy (DRSP) in 2006 (applicable to .1. Under the auDRP. 02/2003.1.1. whereas the UDRP requires the complainant to prove both elements.1. Case No. First. is an Unfair Registration. 75 See GE Capital Finance Australasia Pty v Dental Financial Services Pty Ltd. A non-exhaustive list of factors which may be evidence that the Domain Name is an Unfair Registration is set out in paragraphs 5. trademark or service mark in which the complainant has rights. However. under the second circumstance of bad faith of the UDRP a pattern of conduct is required. that: 4. DAU2004–0004. in paragraph (i).1. and 4. Second. it uses the expression ‘Unfair Registration’ in place of ‘Abusive Registration’: This Policy and Procedure applies to Respondents when a Complainant asserts to the DNC according to the Procedure. business or other legal or trading name.1.

The operative provisions state: You are required to submit to a mandatory administrative proceeding in the event that a third party (a ‘Complainant’) asserts to the applicable Provider. usTLD Dispute Resolution Policy The usTLD Dispute Resolution Policy is also based on the UDRP. Your domain name is identical or confusingly similar to a trademark or service mark in which the Complainant has rights. ii. and the circumstances indicate that it was intended by both the Complainant and the Respondent that the Complainant would be entered in the Register as the Registrant of the Domain Name. 5. that: i. mislead or deceive people or businesses into believing that the Domain Name is registered to. Circumstances indicating abusive registration include that the registrant has registered or acquired the domain name primarily: for the purposes of selling.1. It sets out the policy ideas and a general overview of the structure and purpose of the DRS. in compliance with the Rules. documented out-of-pocket costs directly associated with acquiring or using the Domain Name.uk DRSP replaces the UDRP’s concept of bad faith with the expression ‘abusive registration’ and provides a definition.2.uk DRSP The . Your domain name has been registered in bad faith or is being used in bad faith.5. or The Domain Name was registered arising out of a relationship between the Complainant and the Respondent. The .1. or otherwise connected with the Complainant.3.uk domains.4. or (c) for the purpose of unfairly disrupting the business of the Complainant. You have no rights or legitimate interests in respect of the domain name. and the Domain Name is part of that pattern.1.77 . The Complainant can demonstrate that the Respondent has knowingly given false contact details to a Registrar and/or to the DNC. or Circumstances demonstrating that the Respondent is using the Domain Name in a way which is likely to confuse.uk Dispute Resolution Service Policy (DRSP) is part of the contract of registration for . . operated or authorised by. 77 usTLD DRP clause 4(a).1.nz or otherwise) which correspond to well known names or trade marks in which the Respondent has no apparent rights. (b) as a blocking registration against a name or mark in which the Complainant has Rights. 5. 5. and iii. The Complainant can demonstrate that the Respondent is engaged in a pattern of registrations where the Respondent is the registrant of domain names (under . renting or transferring the Domain Name to the Complainant or competitor for an amount valuable in excess of out-of-pocket costs.178 LAW OF ELECTRONIC COMMERCE 5.

78 The operative provisions state: A Respondent must submit to proceedings under the Dispute Resolution Service if a Complainant asserts to us. The Complainant has Rights in respect of a name or mark which is identical or similar to the Domain Name. or for the purpose of unfairly disrupting the business of the Complainant. The operative provisions state: Any Person who considers that a registered domain name conflicts with his legitimate rights or interests may file a Complaint to the . trademark or service mark in which the Complainant has rights.IN Registry on the following premises: (i) the Registrant’s domain name is identical or confusingly similar to a name. It sets out terms and conditions in connection with any challenge to a decision by the sponsor concerning eligibility to register in .name. . There shall be a presumption of Abusive Registration if the Complainant proves that [the] Registrant has been found to have made an Abusive Registration in three or more Dispute Resolution Service cases in the two years before the Complaint was filed.aero.81 The Eligibility Requirements Dispute Resolution Policy (ERDRP) deals with the TLD . and (iii) the Registrant’s domain name has been registered or is being used in bad faith. The Domain Name.uk DRSP clause 3. in the hands of the Respondent.in Dispute Resolution Policy (INDRP). and ii. Registrations in .aero.name must comprise an individual’s 78 79 80 81 . that: i. the UDRP and the relevant provisions of the Information Technology Act 2000 (India). See www.aero and is not an ICANN policy. is an Abusive Registration.in Domain Name Registry has published the .icann.79 INDRP In India the .80 Additional policies The Eligibility Reconsideration Policy (ERP) is incorporated into agreements with registrants concerning domain name registrations in .org/udrp. . (ii) the Registrant has no rights or legitimate interests in respect of the domain name. This policy was developed by the sponsor of . according to the Procedure.UNIFORM DOMAIN NAME DISPUTE RESOLUTION POLICIES 179 as a blocking registration against a name or mark in which the Complainant has rights. It has been formulated in line with internationally accepted guidelines. INDRP clause 4.uk DRSP clause 2.

The Intellectual Property Defensive Registration Challenge Policy (IPDRCP) applies to intellectual property defensive registrations in the .biz.cat are restricted to members of the Catalan linguistic and cultural community. The Qualification Challenge Policy (QCP) also deals with the TLD . . Disputes in the . An intellectual property defensive registration may be registered only by the owner of an eligible trade mark or service mark registration. which is followed by the . .cat. Any ICANN-accredited registrar may initiate a TDRP proceeding against another registrar. Proceedings under the TDRP must be filed either with the appropriate registry operator or with an independent dispute resolution provider.83 82 Note that the Start-Up Trademark Opposition Policy (STOP) was available to intellectual property owners who enrolled in the IP Claim Service during the start-up phase of the . The Restrictions Dispute Resolution Policy (RDRP) applies to the restricted TLD .cat ERDRP) applies to the TLD .pro TLD. Challenges to a registration on the grounds that the registrant did not meet the registration qualifications may be made under the QCP.pro TLDs. A challenge to a registration under the Qualification Challenge Policy may be brought by any interested party. Disputes can be brought under the UDRP.cat Eligibility Requirements Dispute Resolution Policy (. .82 The Transfer Dispute Resolution Policy (TDRP) applies to transactions where the registrant transfers or attempts to transfer the domain name to a new registrar. Challenges to a registration in . . This TLD is restricted to certified practising members of the medical.net. Numeric characters may be used in combination with the personal name. Challenges to a registration or use of a given domain name on the grounds that it is not being or will not be used primarily for such a purpose are filed under the RDRP. www.info.pro.biz TLD is intended for bona fide business or commercial purposes. and . The .org.biz registry during 2001. STOP is no longer available. .name domain are filed under the ERDRP.biz. The TDRP deals with registrar disputes under the Inter-Registrar Transfer Policy. Challenges under the RDRP may be initiated by any party filing a complaint with an approved dispute resolution service provider.icann. The IPDRCP provides an avenue for challenges concerning whether such registrant meets the Registration Qualifications.180 LAW OF ELECTRONIC COMMERCE personal name or the personal name of a fictional character provided the registrant holds a trade mark or service mark in the character’s personal name. see. . the RDRP or through the courts. generally. The .cat on the grounds that it does not meet the eligibility requirements are filed under the ERDRP.org/udrp. 83 For all the policies. although extensions may be considered.name. legal and accounting professions. Defensive registrations and second level domain email address registrations may be disputed under the ERDRP. Registrations in .com.

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Practical ramifications
An aggrieved party who wishes to initiate proceedings may choose a dispute resolution process available from the domain name administrators, or legal proceedings before a court. These actions are not mutually exclusive, and a party may fail in one action, and succeed in the other. Their procedures, rules and approaches are for the most part unrelated. The legal process is typically slow and the cost of lawyers is often prohibitive. The proceedings are in person and rely on a range of laws and malleable common law and general law principles. An aggrieved party may be able to establish the elements of passing off, but the same circumstances may not give rise to a remedy under the dispute resolution processes. It is up to aggrieved parties to determine which process is best in their situation.

Conclusion
The nature of domain names gives rise to an inevitable conflict between registered users of domain name and holders of trade marks. The reason for conflict is that the domain name must be unique, while trade marks and other business and social identifiers may be shared: there can be only one holder of domain name ‘identifier.com’, for example, but there can be multiple users of the trade mark ‘identifier’ in various countries and jurisdictions. Keeping this uniqueness of domain names in mind, a legal mechanism for its allocation is most necessary. The policy of ‘first come first served’ was adopted and consistently followed by various domain name administrators, but in recent times it has been frequently negated by the various courts, UDRP panels and various local DRP panels in favour of other rights (not exclusively those of trade mark owners). The rejection of the policy in cases of ‘cybersquatting’ is quite justified in my view, but rejection of the policy in order to protect senior users of the trade mark is uncalled for.84 Domain name registration policy rewards trade mark owners who have the foresight to register their trade marks as domain names.85 The initial run on established stakeholders who failed to record their interests on domain names registers has expired. The ignorance of the 1990s has passed. Nevertheless, new interests emerge. As evidence of this, just note the run of various combinations of the footballer Beckham, his number and club when he changed clubs. Cyberpiracy continues to take on various forms, not all of which are readily apparent. ICANN and its various constituents must maintain a constant vigil. There has been a reluctance to make changes to the UDRP, but after a decade of use and experience a review of its application would be wise.
84 See Spyros M. Maniatis, ‘Trade mark law and domain name: Back to basics’ (2002) 24 EIPR 397. 85 Data Concepts v Digital Consulting Inc. and Network Solutions Inc. 150 F. 3d 620, 1998 US App. LEXIS 17758 (6th Cir 1998).

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Further reading
Colm Brannigan, ‘The UDRP: How do you spell success?’, (2004) Digital Technology Law Journal. JR Dupre, ‘A solution to the problem? Trade-mark infringement and dilution by domain names: Bring the cyber world in line with the “real” world’, (1997) 87 Trade Mark Reporter 613. Michael Geist, ‘Fair.com?: An examination of the allegations of systemic unfairness in the ICANN UDRP’, (2002) 27 Brooklyn Law School Journal of International Law 903. Julia H¨rnle, ‘Disputes solved in cyberspace and the rule of law’, 16th BILETA Annual o Conference, Edinburgh, 9–10 April 2001; www.bileta.ac.uk/01papers/horle.html. Annette Kur, ‘UDRP: A study by the Max-Planck Institute for Foreign and International Patent, Copyright and Competition Law, Munich’: see Summary and Proposals at p. 72. Available at www.intellecprop.mpg.de/Online-Publikationen/2002/UDRPstudy-final-02.pdf. David S. Wall, Cyberspace crime, Dartmouth, London, 2003.

11
Jurisdiction in cyberspace
When a radically new situation is presented to the law it is sometimes necessary to think outside the square . . . this involves a reflection upon the features of the Internet that are said to require a new and distinctive legal approach.1

Cyberspace is an illusion. There is no such place. Many terrestrial norms do not and cannot apply to such a fictitious construct. Nevertheless cyberspace users perceive metaphorical chat rooms, folders, files, shops, libraries and so forth. They live digital lives with digital personas in ‘places’ such as Second Life and Facebook. 2 The reality is that each step of the digital experience is rooted terrestrially. Traditional legal principles are applicable to the majority of electronic commerce disputes. Nevertheless, the operation of electronic commerce in cyberspace results in new circumstances to which legal jurists cannot readily apply established legal rules. The borderless nature of the internet often hides or disguises the origin of particular websites and corresponding information. Questions sometimes arise as to the country or state whose courts have jurisdiction to adjudicate on a matter, and as to which law is to be applied. Courts also have to determine issues such as where conduct occurs – at the computer, the server, the place of business or residence or somewhere else? – and thus which time zone applies. This area of law is referred to as conflict of laws or private international law,3 and its principles are well established.

Rules of private international law
It is possible that an Australian court will determine that the law which applies to a particular situation is that of another country. In this case the Australian court will
1 Kirby J, Dow Jones v Gutnick [2002] HCA 56, para 112. 2 See secondlife.com and www.facebook.com. 3 See Peter Nygh and Martin Davies, Conflict of laws in Australia, 7th edn, LexisNexis, Sydney, 2002.

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apply that other country’s law. Typically, the parties to an international contract will specifically identify the law which applies to the contract. The parties may also identify which country’s courts have jurisdiction to hear disputes arising under the contract. Contractually, parties may include an express choice of law clause under the principle of party autonomy.4 However, there are exceptions.5 Where there is no express choice of law the courts will attempt to find an implication of choice from the language of the documents, the prior conduct of the parties, the place of performance and other surrounding circumstances.6 Where there is no express choice and one cannot be implied, the contract will be governed by the law of the jurisdiction ‘most closely connected’ to the contract. This may depend upon the subject matter, nationality or domicile of the parties, the place of performance and other factors.7 Once the proper law is determined, the rules of that system of law are applied to the contract.

Forum non conveniens
The issue of choice of forum in which to hear an action is known as forum non conveniens. Each nation state determines its own laws and procedures. These laws are termed lex fori or the law of the forum. Each nation’s court system must determine, through its own civil procedure, when and how it should accept jurisdiction. It will take into account numerous factors, such as residence and nationality of the parties, the place or places of business, and the subject matter (when the law suit begins). Often the issue is routine and uncontroversial, but where one or more of the parties reside outside the nation state or the subject matter of harm occurs elsewhere the question of jurisdiction must be settled. The English approach to determining the forum, recognised by most common law jurisdictions, is the test of ‘the clearly more appropriate forum’.8 The Australian courts have developed a broader test, that of ‘the clearly inappropriate forum’. This has resulted in the taking of jurisdiction more often.9 The High Court reaffirmed its position in Regie National des Usines Renault SA v Zhang:10 ‘[a]n Australian court cannot be a clearly inappropriate forum merely by virtue of the circumstance that the choice of law rules which apply in the forum

4 See Vita Food Products Inc. v Unus Shipping Co. [1939] AC 277, per Lord Wright. 5 For example, see Golden Acres Ltd v Queensland Estates Pty Ltd [1969] Qd R 378, and Minnesota v Granite Gate Resorts Inc. 568 NW 2d 715. 6 See Atlantic Underwriting Agencies Ltd v Compagnia di Assicuranzione di Milano SpA [1979] 2 Lloyds Rep 240. 7 See Re United Railways of the Havana and Regla Warehouses Ltd [1960] Ch 52 and Mendelson-Zeller Co. Inc. v T & C Providores Pty Ltd [1981] 1 NSWLR 366. 8 See Spiliada Maritime Corporation Ltd v Cansulex Ltd [1987] AC 460. 9 See Oceanic Sun Line Special Shipping Co. v Fay (1988) 62 ALJR 389; Voth v Manildra Flour Mills Pty Ltd (1990) 65 ALJR 83; Henry v Henry (1996) 185 CLR 571. 10 [2002] HCA 10.

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require its courts to apply foreign law as the lex causae’. Although superficially the English and Australian tests look similar, an analysis demonstrates that the Australian test will result in the courts taking jurisdiction more often.

Dow Jones v Gutnick
A number of foreign cases have raised novel problems associated with jurisdiction in cyberspace. ` The application of the internet vis a vis jurisdiction and cyberspace was explained in Dow Jones v Gutnick.11 Gleeson CJ, McHugh, Gummow and Hayne JJ explained:
The World Wide Web is but one particular service available over the Internet. It enables a document to be stored in such a way on one computer connected to the Internet that a person using another computer connected to the Internet can request and receive a copy of the document . . . the terms conventionally used to refer to the materials that are transmitted in this way are a ‘document’ or a ‘web page’ and a collection of web pages is usually referred to as a ‘web site’. A computer that makes documents available runs software that is referred to as a ‘web server’; a computer that requests and receives documents runs software that is referred to as a ‘web browser’. The originator of a document wishing to make it available on the World Wide Web arranges for it to be placed in a storage area managed by a web server. This process is conventionally referred to as ‘uploading’. A person wishing to have access to that document must issue a request to the relevant server nominating the location of the web page identified by its ‘uniform resource locator (URL)’. When the server delivers the document in response to the request the process is conventionally referred to as ‘downloading’.12

Dow Jones v Gutnick13 is the most significant Australian authority on internet jurisdiction to date. Dow Jones published the Barrons Magazine (Barrons), which contained an article entitled ‘Unholy Gains’ and sub-headed ‘When stock promoters cross paths with religious charities, investors had better be on guard’. The article alleged, among other things, that Victorian businessman Joseph Gutnick was ‘masquerading as a reputable citizen when he was a tax evader who had laundered large amounts of money’.14 The magazine sold 305,563 hard copies (14 of those in Victoria) and was available on the website wsj.com to some 550,000 subscribers (some 300 of whom were in Victoria). Dow Jones operated in New York and its internet servers were located in New Jersey. Dow Jones v Gutnick did not involve personal jurisdiction, as the defendant was not within jurisdiction. Personal jurisdiction is typically satisfied where the defendant is physically present in the jurisdiction or has significant contacts with
11 [2002] HCA 56; (2002) 210 CLR 575. 12 [2002] HCA 56, [15]–[16]; (2002) 210 CLR 597–98. 13 [2002] HCA 56; on appeal from Gutnick v Dow Jones [2001] VSC 305 and Dow Jones Company Inc. v Gutnick [2001] VSCA 249. See, generally, ‘A “category-specific” legislative approach to the internet personal jurisdiction problem in US law’, (2004) 117 Harv LR 1617. 14 [2001] VSC 305, para 3.

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the jurisdiction, such as a branch office or registered interest. The nature of internet interaction will lead to many instances where personal jurisdiction will not arise. The case attracted significant international attention. Media outlets were concerned about the implications for them if nations like Australia accepted jurisdiction for publications which were ostensibly intended for the domestic US market, but which were sold in part or peripherally internationally. The High Court of Australia permits pleadings in appeals by interveners in matters of general public importance if the issue relates to maintaining some particular right, power or immunity which affects the interveners.15 An intervener has the same rights and obligations as the other parties to the action, including the ability to appeal, tender evidence and participate fully in all aspects of the argument. The interveners included Amazon.com Inc.; Associated Press; Cable News Network LP LLLP (CNN); Guardian Newspapers Ltd; The New York Times Company; News Limited; Time, Inc.; Tribune Company; The Washington Post Company; Yahoo! Inc.; and John Fairfax Holdings Ltd. The matter came before Hedigan J at first instance. His Honour particularly examined jurisdiction in relation to the internet connection, as this could affect the award of damages. Geoffrey Robertson QC for Dow Jones made several unsuccessful submissions. Robertson submitted that imposing liability where downloading occurred ‘would have a serious “chilling effect” on free speech’. He argued that ‘a narrow rule was appropriate for the age of globalisation’ and that ‘the Internet offer[ed] Australians the greatest hope of overcoming the tyranny of distance’. He submitted that Hedigan J had ‘a national duty to decide that there was no jurisdiction in Australia even if [the judge] had a legal view to the contrary, and that it [wa]s [his Honour’s] duty publicly to declare that Mr Gutnick’s action against Dow Jones take place in New Jersey’. Robertson suggested that downloading is ‘self-publishing’ and that ‘the process is akin to taking a book out of a library in New Jersey and taking it home to Victoria to read’. He ‘flirted with the idea’ that cyberspace should be a defamation-free zone,16 and argued that the article was published ‘in America for Americans’ and that the events constituted ‘a tort having an indelibly American complexion’.17 The plaintiff submitted that publishing occurs when data is made ‘intelligible or manifest to a third party’ and argued that that has been the law for 400 years in other contexts. Hedigan J rejected counsel’s ‘bold assertions’, commenting that the unique nature of the internet must not lead to the abandonment of the analysis that the law has traditionally and reasonably followed to reach just conclusions. His Honour expressed concern that Robertson’s arguments, ‘attractively presented

15 Australian Railways Union v Victorian Railways Commissioners (1930) 44 CLR 319 at 33, per Dixon J. 16 See M Kirby, ‘Privacy in cyberspace’, (1998) UNSWLJ 47. 17 [2001] VSC 305, paras 15–20.

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as they were, became enmeshed in pop science language’ and degenerated into ‘“sloganeering” which in the end decides nothing’.18 Hedigan J referred to the following authorities to formulate his view. First, his Honour politely questioned the value of the decision in Macquarie Bank v Berg19 without making any attempt to directly address issues raised. He then referred to Digital Equipment Corporation v Alta Vista Technology Inc.,20 where to determine jurisdiction the court examined the question of whether the owner and controller of a website can with some degree of certainty ‘know’ if the content of the site reaches the user. The court felt that:
Using the Internet . . . is as much knowingly ‘sending’ . . . as is a telex, mail or telephonic transmission; . . . ATI ‘knows’ that its Website reaches residents . . . who choose to access it, just as surely as it ‘knows’ any lateral telephone call is likely to reach its destination.

Lee Teck Chee v Merrill Lynch International Bank21 involved the republication of a Singapore newspaper on the internet. Nathan J, of the High Court of Malaysia, held that publication had not taken place in Malaya because the alleged defamatory words had been published on a Singapore server. However, the judgment is of limited value as there was no evidence presented that any person in Malaya had accessed the website. In Kitakufe v Oloya Ltd22 the Canadian court assumed jurisdiction for a defamatory statement made in a Ugandan newspaper republished on the internet. The plaintiff was a medical practitioner born in Uganda, but practising in Canada. The defendant argued that Uganda was a more convenient and natural forum, and that the proceedings had numerous real and significant links to Uganda. These included that the plaintiff had assets in Uganda, and that the defendant’s concerns regarding malice, ethnic rivalry and the defence’s credibility meant that the case would be better dealt with in Uganda. The defence also expressed concern about the significant expense and inconvenience of calling witnesses based in Uganda to a case run in Canada. Despite this multitude of connections with Uganda, Hume J assumed jurisdiction on the basis of access to the website and downloading, concluding that it was ‘not satisfied that the plaintiff would not be deprived of a legitimate personal and juridical advantage’ if the case were run in Uganda. Hedigan J described this case as one where ‘a superior court assumed jurisdiction over a defamation suit on the basis of access to the Website and its reception (that is, downloading) in Ontario, Canada’. In Godfrey v Demon Internet Ltd,23 Moreland J determined that an internet bulletin board amounted to publishing postings to subscribers. Godfrey was a science lecturer in England and the defendant hosted a news group whereby users could make postings contributing to targeted discussions. One posting
18 19 20 21 22 23

[2001] VSC 305, paras 70 and 71. [1999] NSWSC 526. 960 F. Supp. 456 (D Mass 1997). [1998] CLJ 188. [1998] OJ No. 2537 QL (Ont Gen Div). [2001] QB 201.

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claimed to be Godfrey, but in fact was written by an imposter. The posting was defamatory. Godfrey requested its removal within ten days. The defendant did not and it remained online until it expired in the usual course (two weeks later). Moreland J held that the defendant had published the posting whenever a subscriber accessed the news group:
In my judgment the defendant, whenever it transmits and whenever there is transmitted from the storage of its news server a defamatory posting, publish[es] that posting to any subscriber to its ISP who accesses the newsgroup containing that posting. Thus every time one of the defendant’s customers accesses ‘soc.culture.thai’ and sees that posting defamatory of the plaintiff there is a publication to that customer.

Hedigan J took particular note of the expression ‘sees that posting defamatory of the plaintiff’: he regarded this as the equivalent of downloading. Hedigan J cited Calder v Jones24 with approval, referring to the statement of the US Supreme Court that ‘jurisdiction may be exercised over a foreign defendant who directs his or her defamatory message at the forum and the plaintiff suffers harm there’.25 From these cases Hedigan J concluded that the place of defamation is ‘the jurisdiction where the defamatory material was published and received by the plaintiff, rather than where it was spoken or written’, and so the Dow Jones article was published in the state of Victoria when downloaded by Dow Jones subscribers who had met Dow Jones’s payment conditions and used their passwords. The defendant’s argument that it would be unfair for the publisher to have to litigate in the multitude of jurisdictions in which its statements are downloaded and read, he said, ‘must be balanced against the world-wide inconvenience caused to litigants, from Outer Mongolia to the Outer Barcoo’. His Honour stated that ‘if you do publish a libel justiciable in another country with its own laws . . . then you may be liable to pay damages for indulging that freedom’.26 Hedigan J considered the following additional factors as significant: ● the publication was downloaded in Victoria; ● the plaintiff’s residence, business headquarters, family, social and business life are in Victoria; ● the plaintiff seeks to have his Victorian reputation vindicated by the courts of the state in which he lives; ● the plaintiff undertook not to sue in any other place. His Honour concluded that given these factors ‘it would be verging on the extraordinary to suggest that Mr Gutnick’s action in respect of that part of the publication on which he sues should be removed for determination to the State of New Jersey’.27 Dow Jones maintained that the article was ‘indelibly American, written by Americans for Americans interested in the stock market and
24 25 26 27

465 US 783 (1984). Counsel also referred to R v Burdett (1820) 4 B & Ald 115. [2001] VSC 305, para 75. [2001] VSC 305, para 131.

it might freeze publication or censor it or try to restrict access to it in certain countries so as to comply with the most restrictive defamation laws that could apply. is that ‘the aspect sued on by Mr Gutnick is indelibly Victorian. para 79. Gleeson CJ. and noted that a publisher may choose the server’s location based on a range of factors. McHugh. and continuity of service. stating: To tell a person uploading potentially defamatory material onto a website . may have undesirable consequences. including costs of operation. connected with no other place. the High Court dismissed the appeal of Dow Jones. para 117.31 His Honour drew an analogy between the development of such new legal rules and the Law Merchant (lex mercatoria). and that any documentation or evidence concerning the matter will all be found in Victoria’. His Honour described the internet as ‘essentially a decentralised. which arose out of the general custom of the merchants of many nations in Europe. para 129. They also noted that the publisher may have servers in more than one state or country. This judgment was less than two pages. [that that act] will render that person potentially liable to proceedings in courts of every legal jurisdiction where the subject enjoys a reputation. The court determined that publication of a defamatory statement for an online subscription website occurs at the place of downloading. . ‘unless that place was merely adventitious or opportunistic’. [2002] HCA 56.JURISDICTION 189 its affairs’. [2002] HCA 56. Adventitious and opportunistic Dow Jones submitted that the applicable law should be that of the place where the web servers were maintained. as the location of its servers was not determined for legal or advantageous considerations. On 10 December 2002 the High Court of Australia handed down its decision in Dow Jones v Gutnick. .29 The issue then came before the High Court of Australia. but in four separate judgments. but argued that it did not ‘misuse’ this rule. the Victorian Court of Appeal quickly and with little consideration and analysis dismissed the appeal by Dow Jones. Kirby J flagged the danger in finding otherwise. The corollary argument was made that plaintiffs like Gutnick could choose the most favourable jurisdiction to them in which to commence proceedings. self-maintained telecommunications network’ which ‘demands a radical reconceptualisation of the applicable common law’. The weakness in this argument. Dow Jones v Gutnick [2001] VSCA 249. Dow Jones recognised the argument that publishers could place their servers in jurisdictions most advantageous to them.30 Kirby J dealt with the legal response to the impact of the internet. benefits offered for setting up business. security. By 7–0. Gummow and Hayne JJ stated that ‘adventitious’ and ‘opportunistic’ are words likely to produce considerable debate. 28 29 30 31 [2001] VSC 305.28 Less than one month after the judgment by Hedigan J. writes Hedigan J. . Depending on the publisher and the place of its assets.

The issue of defamation did not reach the court. and what rules about defamation applied in that place or those places’. Gutnick claimed vindication. which ‘does not represent a wholly satisfactory outcome. Dow Jones made an out of court payment of $450. para 166. 35 [2002] HCA 56. . The court’s attitude towards either the plaintiff or the defendant choosing the most advantageous jurisdiction or the publisher placing its server in a jurisdiction with no defamation law remains untested.32 Kirby J described the dismissal of the appeal as ‘contrary to intuition’. but it did not determine liability. for every article it publishes on the internet. and sought no adventitious of opportunistic advantage. identifying the person about whom material is to be published will readily identify the defamation law to which that person may resort’. on this occasion he sued in the jurisdiction of his business. international discussion in a forum as global as the Internet itself’. Dow Jones claimed it was in the right and that the payment would not cover Gutnick’s legal costs. McHugh.34 According to Gleeson CJ. Their Honours drew an analogy with the developing defence of innocent dissemination. 36 465 US 783 (1984). para 51. Gummow and Hayne JJ suggested that ‘reasonableness of the publisher’s conduct’ might be considered ‘necessary or appropriate’ as a common law defence where all the publisher’s conduct occurred outside the jurisdiction. and the human right to protection by law for the reputation and honour of individuals. Gleeson CJ. an Academy award-winning actress who lived and worked in California. Jones was defamed by an article in the National Enquirer which was 32 [2002] HCA 56. ‘the defamation laws of every country from Afghanistan to Zimbabwe’ – is ‘unreal when it is recalled that in all except the most unusual of cases.000. the ‘spectre which Dow Jones [seeks] to conjure up’ – that a publisher would be forced to consider. Calder v Jones36 concerned Shirley Jones. and that this warrants ‘national legislative attention and .190 LAW OF ELECTRONIC COMMERCE bypassing nations with free speech and freedom of expression. para 54. . The place where the defamation was comprehended and the plaintiff’s connection with the locality were important factors. McHugh. domicile and residence. Gummow and Hayne JJ. 34 Postscript: The High Court of Australia determined that the Supreme Court of Victoria had jurisdiction. .’ His Honour seemed to feel that a balance is yet to be determined between the human right of access to information and to free expression. Gutnick’s response was that whilst that may be so. 33 [2002] HCA 56.33 The court determined that the place where damage was inflicted was a most significant factor. Their Honours identified relevant circumstances as ‘including where that conduct took place.35 Effects test One solution may be the adoption of an effects test. but claimed that the payment was not for defamation.

(1965) 81 Law Quarterly Review 518. California is the focal point both of the story and of the harm suffered. ‘Venue and the Ambit of Criminal Law’. petitioners must ‘reasonably anticipate being hauled into court there’ to answer for the truth of the statements made in their article. in terms both of respondent’s emotional distress and the injury to her professional reputation. Part 3. actions were expressly aimed at California. 39 See G Williams.38 The concept that a person ought to be liable for a deliberate act which targets another jurisdiction and causes harm there clearly can be useful for cyberspace quandaries. including a substantial readership in California. Gummow and Hayne JJ endorsed the effects test approach: Activities that have effects beyond the jurisdiction in which they are done may properly be the concern of the legal systems in each place.40 It is the place where the physical act took effect on its victim. The effects test can be compared to the terminatory theory of criminal law espoused by Professor Glanville Williams39 and approved by Stephen J in Ward v R.41 Australian cases The first Australian case with an element of internet jurisdiction is Macquarie Bank v Berg. . The defendants challenged the jurisdiction of the Californian courts. Rather. not where the physical act of perpetrator was done. . their intentional. In sum. . 42 [1999] NSWSC 526. in turn. [The defendants] are not charged with mere untargeted negligence. McHugh. 788–89. The mere fact that [the defendant] can ‘foresee’ that the article will be circulated and have an effect in California is not sufficient for an assertion of jurisdiction . but its approach has been used and quoted in cyberspace jurisdiction cases. Gleeson CJ. 38 For example by Hedigan J in Gutnick v Dow Jones [2001] VSC 305 and Healthgrades. was suffered in California. 40 Ward v R [1980] HCA 11. and the brunt of the harm.com v Northwest Healthcare Alliance No. Jurisdiction over petitioners is therefore proper in California based on the ‘effects’ of their Florida conduct in California . In considering where the tort of defamation occurs it is important to recognise the purposes served by the law regarding the conduct as tortious: purposes that are not confined to regulating publishers.JURISDICTION 191 published in Florida but had a nationwide circulation. It impugned the professionalism of an entertainer whose television career was centered in California.42 Berg was a disgruntled ex-employee of Macquarie Bank who 37 465 US 783 (1984).37 This case did not involve the internet or cyberspace. The article was drawn from California sources. Under the circumstances. . 41 [2002] HCA 56. which courts have jurisdiction in respect of that act. para 4 per Stephen J. that determines the locus of the crime and. This joint ‘target’ and ‘harm’ criteria is often referred to as the ‘effects test’: The allegedly libelous story concerned the California activities of a California resident. 01-35648 (9th Cir 2002). In Dow Jones v Gutnick. . para 24. The US Supreme Court held that California was the ‘focal point both of the story and of the harm suffered’. and allegedly tortious.

one knows that it is not. [2002] NSWSC 138. or Mongolia. Supp. territory and country of the world. v Instruction Set Inc. [counsel] sought to narrow the claim by limiting the order sought to publication or dissemination ‘within NSW’. . . and indeed. and the website was dedicated entirely to Macquarie Bank and its senior employees. described the difficulties of such a request in the following terms: . material is transmitted anywhere in the world that has an Internet connection . so Berg ought to have expected to be brought before the courts there. the undesirability of superimposing the defamation law of New South Wales onto every other state.46 In Airways Corporation of NZ Ltd v PriceWaterhouse Coopers Legal47 Simpson J had the opportunity to reconsider her decision in Macquarie Bank. for as long as the material remains online. 24 hours a day. would have the effect of restraining publication of all the material presently contained on the website to any place in the world. see paras 14–16. is ineffective. [1999] NSWSC 526. Yet that would be the effect of an order restraining publication on the Internet. In terms of an effects test. of certain material capable of 43 44 45 46 47 [1999] NSWSC 526. It is not to be assumed that the law of defamation in other countries is coextensive with that of NSW. To make an order interfering with such a right would exceed the proper limits of the use of the injunctive power of this court. Recognising the difficulties associated with orders of such breadth. The limitation.43 Simpson J did not accept jurisdiction and refused to grant the injunction.192 LAW OF ELECTRONIC COMMERCE placed defamatory material regarding the bank and its senior employees on a website.44 This reasoning repeats the erroneous approach of Inset System Inc. her Honour spuriously reasoned: The difficulties are obvious. However. (see below). according to the law of the Bahamas. by email. bearing in mind the fact that publication on the internet is continuous. but could be accessed and viewed in New South Wales. and the interlocutory nature of the application. [1999] NSWSC 526. . Macquarie Bank sought an ex parte interlocutory injunction to restrain publication of the material on the internet. 161 (D Conn 1996). 937 F. and to protect the rights of plaintiffs. Tazhakistan. Berg had moved to California and the material in question was located on a server there. the target and the harm were entirely in New South Wales. The proceedings arose out of the publication. to make the order as initially sought. . However. . as those rights are defined by the law of NSW. para 14. Berg clearly had several connections with New South Wales. Simpson J. Such an injunction is not designed to superimpose the law of NSW relating to defamation on every other state. The factors against the grant of jurisdiction included the enforceability of such an order. territory and country of the world. once published on the Internet. para 12. It may very well be that. however. An injunction to restrain defamation in NSW is designed to ensure compliance with the laws of NSW.45 The mere fact that a website reaches another jurisdiction is not a sufficient ground to grant or assume that jurisdiction. the defendant has an unfettered right to publish the material.

[2002] NSWSC 254.com and not a . I am prepared to accept the conclusions of the Supreme Court of Victoria and the Court of Appeal of Victoria but bear in mind that these conclusions were reached on the basis of evidence placed before Hedigan J. para 55. but in light of the Dow Jones decisions in the Victorian Supreme Court.50 Macquarie Bank’s counsel reserved the right to argue whether the placement on the internet in the United States of defamatory material accessible in New South Wales amounted to publication of the material in New South Wales. Smart AJ concluded that until ‘the facts are found definitively it is too early to say which law applies’. Nevertheless. The NSW Supreme Court had the opportunity to revisit the Macquarie Bank Limited v Berg case in mid-2002. The only evidence as to receipt of the material was from two witnesses. and it was 48 49 50 51 52 53 [2002] NSWSC 138. each of whom received it in New Zealand.’52 In ACCC v Purple Harmony Plates Pty Limited53 the Federal Court of Australia considered the difference between websites registered internationally with . . for present purposes I work on the basis that publication by email takes place where the email is received and that. and not in the location from which they are transmitted .48 Thus Simpson J reversed her previous position. without deciding the issue. The defendants challenged the jurisdiction of the court on several spurious grounds.com sites were administered. [2001] FCA 1062. In relation to the website. that was in New Zealand.51 Smart AJ distinguished the Dow Jones case. where the .JURISDICTION 193 defaming the plaintiffs. [2002] NSWSC 254. For present purposes. on the evidence in this case. . the defendant argued that it used a . Goldberg J rejected this approach: the registrant was Australian. Counsel cited the decision of Hedigan J in Gutnick v Dow and the Court of Appeal. Counsel argued that the evidence disclosed no connection with New South Wales.com and Australian-administered and registered sites with . and that the appropriate forum for the commencement of any defamation proceedings should be New Zealand.au registration and as such the site should be governed by the laws of Virginia. The defendants were in breach of the Trade Practices Act by advertising on the website in a manner which was misleading and deceptive. that ‘Gutnick was not concerned with the World Wide Web because Dow Jones only put its material on for subscribers or trial subscribers. . That evidence was not necessarily identical to the evidence on this issue placed before me. Berg submitted that the case was ‘overwhelmed by the application of Californian law and that the indications were that the plaintiffs could not win in California because of the law as to free speech’.49 Smart AJ dealt with procedural issues. para 41. See below. though making use of qualifying language. noting.au. para 12. [2002] NSWSC 254. Simpson J stated: In these decisions it was held that internet publications take place in the location where they are read.

more than one common law jurisdiction has been guided by them. Passive sites merely display information. v Instruction Set Inc. and the convenience of the parties. See also Helicopteros Nationales de Columbia SA v Hall 466 US 408. 56 326 US 310 (1945). granted jurisdiction over a defendant who maintained a mere passive website. on hearing evidence that as many as 10.194 LAW OF ELECTRONIC COMMERCE irrelevant that the agreement with the domain name administrator may not be subject to the jurisdiction of Australian courts. Early US experience The early cases emanated from the United States. . Active websites may provide for form filling.54 In the United States. The courts later distinguish between passive and active websites. Early cyberspace cases mistakenly granted jurisdiction merely on the basis that the defendant’s website could be accessed in the plaintiff’s jurisdiction. and for contracting online. US courts are required to use due process (under the 14th Amendment to the US Constitution). Supp. in Zippo Manufacturing Co. 161 (D Conn 1996). Although these US cases involved constitutional factors.56 The ‘purposeful availment’ requirement ensures that random and fortuitous contacts do not cause a defendant to be improperly brought into a forum.55 the US Supreme Court held that due process requires the defendant to have ‘minimum contacts’ with the plaintiff’s jurisdiction and prescribes that the choice of jurisdiction be consistent with ‘traditional notions of fair play and substantial justice’. Supp. 54 For example.58 the Minnesota court examined five factors: the quantity of contacts. 59 952 F. In Inset System Inc. See also Maritz Inc. v Kostiuk (1999) 63 BCLR (3d) 156 and the High Court of Delhi in Yahoo Inc. 1119 (WD Pa 1997).59 the court formulated a sliding scale approach which has since been generally adopted. 1328 (ED Mo 1996). it is sufficient if the defendant ‘purposefully availed’ itself of the jurisdiction (such as by repeatedly conducting business there). 947 F. The ‘fair play’ requirement permits the court to examine whether the defendant’s acts or their consequences have sufficient connection with the state to make jurisdiction reasonable. v Washington.57 the court. or may simply provide an email link. On this basis. In International Shoe Co. Supp. 58 568 NW 2d 715. v Zippo Dot Com Inc.. 316. to determine personal jurisdiction. where disputes arose between parties in different states. 57 937 F. the connection between the cause of action and the contacts. see the British Columbia Court of Appeal in Braintech Inc. This number of potential users is now ridiculously conservative. 55 326 US 310 (1945). v Akash Arosa [1999] FSR 931.000 residents of the state could access the website.. v Cybergold Inc. the state’s interest. the quality of contacts. In Minnesota v Granite Gate Resorts Inc.

v Cybersell Inc. Ltd v Ashita Tele Systems Pvt Ltd (2003 (27) PTC 265 (Del)). which had the same name. 61 937 F. descriptions of hotel facilities. 1124 (WD Pa 1997). in Missouri. 3d 1257 (6th Cir 1996). 64 See also Casio India Co. v King61 the plaintiff was the owner of the well-known Blue Note jazz night club in New York.JURISDICTION 195 At one end of the scale: are situations where a defendant has simply posted information on an Internet Web site which is accessible to users in foreign jurisdictions. There was no element of ‘targeting’ (see Effects test. v Patterson66 as an example: there the defendant had purposefully directed his business activities towards residents of another state and the repeated transmissions showed a substantial connection with that state. The court required continuous and substantial contacts with the forum to establish the defendant’s personal jurisdiction: ‘exercising jurisdiction over a defendant who merely advertises its services or product on the Internet would violate the Due Process Clause of the Fourteenth Amendment [and] would disrespect the principles established by International Shoe’. 296 (SD NY 1996). Supp. 60 952 F.64 At the other end of the scale: are situations where a defendant clearly does business over the Internet.65 The Appeals Court in Zippo’s case cited Compuserve Inc. 65 Zippo Manufacturing Co. The defendants advertised their night club. where the Delhi High Court held that once a website can be accessed from Delhi. She commenced proceedings in New Jersey. 130 F. The plaintiff was injured whilst on holiday in the defendant’s hotel. 952 F. 3d 414 (9th Cir 1997). The court held that it lacked jurisdiction over the defendant. Notwithstanding evidence that New York residents both accessed and indeed made bookings based on the information from the Missouri website. v Zippo Dot Com Inc. Supp. in Bensusan Restaurant Corp. A passive Web site that does little more than make information available to those who are interested in it is not grounds for the exercise of personal jurisdiction. it is enough to invoke the territorial jurisdiction of the court. 63 977 F. above) and accordingly no substantial connection was created. 1119 (WD Pa 1997). The website provided photographs of hotel rooms. Supp. it catered mainly for local university students. .60 For example. Access to the website alone was held to be insufficient. Supp. 1124. 1119. The defendant’s website provided no more than passive advertising information. 327 (D NJ 1997).62 In Webber v Jolly Hotels63 the New Jersey-based plaintiff booked a holiday in Italy online. Acts such as selling goods or services would in all likelihood be sufficient to constitute ‘business’ on the internet. If the defendant enters into contracts with residents of a foreign jurisdiction that involve the knowing and repeated transmission of computer files over the Internet. The defendant ran several hotels in Italy and had no connection with the United States. the Appeals Court held that passive websites do not meet the standard of ‘purposeful availment’. 66 89 F. personal jurisdiction is proper. information about numbers of rooms and telephone numbers. 62 See also Cybersell Inc.

1124. If the defendant has repeatedly and knowingly engaged in business with the plaintiff. The defendant knew that US citizens accessed its site and ought to have expected to be held accountable for its breach of the contempt order. Supp. 3d 414 (9th Cir 1997). the grant of jurisdiction is more likely. Kirby J argued that the Australian courts must uphold the right to freedom of speech and freedom of expression as enunciated in article 19 of the ICCPR: Article 19 1. but was a ‘pay’ site. . 1119 (WD Pa 1997). v Chuckleberry Publishing Inc. 69 Criticism has been levelled at the minimum contacts test in relation to the internet and as to what level of interactivity is required to trigger jurisdiction. either orally. and in doing so had distributed its product within the United States in breach of a contempt order. Everyone shall have the right to freedom of expression. The courts then determine the defendant’s level of cognisance. in the form of art. 130 F. or of public health or morals. v Zippo Dot Com Inc. 2.68 These initial cases are difficult to reconcile as they are complicated by noninternet factors and by the varying degrees of judicial understanding of the technology involved. Next. 952 F. 67 939 F. 68 Zippo Manufacturing Co. the defendant must have acted deliberately and purposefully. In Dow Jones. in writing or in print. regardless of frontiers. Taking jurisdiction was thus appropriate. v Cybersell Inc. 1032 (SD NY 1996). (b) For the protection of national security or of public order (ordre public). Everyone shall have the right to hold opinions without interference. The exercise of the rights provided for in paragraph 2 of this article carries with it special duties and responsibilities. Universal rights Australia and the United States are signatories to the UN International Covenant on Civil and Political Rights (ICCPR). but these shall only be such as are provided by law and are necessary: (a) For respect of the rights or reputations of others. the defendant must have targeted or singled out a particular forum.67 the court held that the Italy-based defendant actively solicited US customers to its internet site.196 LAW OF ELECTRONIC COMMERCE In Playboy Enterprises Inc. 3d 1257 (6th Cir 1996) and Cybersell Inc. It may therefore be subject to certain restrictions. this right shall include freedom to seek. Supp.69 First. The required level of ‘interactivity’ can be gleaned from Compuserve v Patterson 89 F. 3. One of defendant’s websites was not just a source of passive information. receive and impart information and ideas of all kinds. In these cases. The middle ground is occupied by interactive Web sites where a user can exchange information with the host computer. the exercise of jurisdiction is determined by examining the level of interactivity and commercial nature of the exchange of information that occurs on the Web site. or through any other media of his choice.

On the one hand Kirby J stated that any development of the common law of Australia should be consistent with the ICCPR principles. 71 Dow Jones press release. home or correspondence.1 and 17. . Given the differences between the laws of Australia and those of other countries in the Commonwealth and beyond.2: Article 17 1. Dow Jones issued a press release supporting an action by William Alpert. No one shall be subjected to arbitrary or unlawful interference with his privacy. corporations and business people. However.JURISDICTION 197 Kirby J was the only High Court Justice to address the effect of this article of the covenant. Australia has accepted the jurisdiction of the U. In response to the High Court’s decision. he foreshadowed Dow Jones’ plea. On the other hand. para 116.S. April 2003. the impact of Australia’s law – as laid out by the High Cour – could harm journalists throughout the world. nor to unlawful attacks on his honour and reputation. who might see the High Court’s decision as an invitation to attack the U.N. like other nations so obliged.S. family. In 2003 Alpert stated that he was filing an action with the Human Rights Commission in Geneva. Powerful and sophisticated plaintiffs could search out overseas jurisdictions willing to help stifle news coverage that was only directed at local readers in those journalists’ home markets. is rendered accountable to the relevant treaty body for such default’70 pursuant to the first Optional Protocol to the ICCPR. Alpert stated: I am filing this action with the Human Rights Commission in Geneva because I fear restrictions on the ability of financial journalists such as myself to report truthfully to United States investors on the activities of foreigners who are actively engaged in the U.71 70 Dow Jones v Gutnick [2002] HCA 56. should the Committee find that those laws unduly restrict the right of free speech that’s protected under Article 19 of the International Convention on Human Rights. his Honour balanced this with the requirements of articles 17. the author of the article in question. fearing unjustified restrictions on journalists. Everyone has the right to the protection of the law against such interference or attacks. I hope that the Human Rights Committee will recognize the threat to free speech – and an informed public – posed by Australian laws that allow suit against any journalist. stating the ‘the need for a clear and single rule to govern the conduct in question according to preestablished norms’. I even fear for our ability to report on U. 2. reputation and personal privacy of individuals: ‘Australia. anywhere that an article published on the internet can be downloaded. Perhaps the Government of Australia will recognize the need to modify its laws. press in a remote forum. even before the Human Rights Committee takes up this case.S. Human Rights Committee and is obliged to modify Australia’s libel laws. markets. to the extent that Australian law does not provide effective legal protection for the honour.

they would not be subject to jurisdiction in Virginia courts. Neither newspaper solicits subscriptions in Virginia.’ Calder. Both newspapers posted some content on the internet. nor maintains any offices or employees within that state. v Digital Service Consultants Inc. 3d 256. The articles included unfavourable comments regarding a movement of inmates between prisons and prison conditions. The New Haven Advocate was a free newspaper published once a week in New Haven. In a statement somewhat reminiscent of the Zippo interactivity test.S. although more narrowly: The facts in this case establish that the newspapers’ websites. The Hartford Courant is a daily newspaper distributed in and serving Hartford. Young was the warden at one of the prisons and commenced action in Virginia against the newspapers and the journalists. as well as the articles in question. the newspapers could not have ‘reasonably anticipate[d] being hauled into court [in Virginia] to answer for the truth of the statements made in their article[s]. 293 F. the Appeals Courts held that as the newspapers were small Connecticut-based publications which served ‘almost exclusively Connecticut readers’. a potential cause of action cognizable in the State’s courts. were aimed at a Connecticut audience. In sum. The Courant had eight mail subscribers residing in Virginia. the newspapers do not have sufficient Internet contacts with Virginia to permit the district court to exercise specific jurisdiction over them. and (3) that activity creates. Connecticut. 264 (4th Cir 2003).74 72 315 F. 714 (4th Cir 2002). Alternative approaches Three days after the decision was handed down by the High Court in the Dow Jones case. at 790 (quotation omitted). but it seems that it did not in fact proceed. 465 U. the court said that it would only accept personal jurisdiction where the defendant: (1) directs electronic activity into the State.73 On the facts. in a person within the State. The newspapers did not post materials on the Internet with the manifest intent on targeting Virginia readers.72 Two Connecticut newspapers published articles on the internet allegedly defaming a Virginia resident. Accordingly. 3d 256 (4th Cir 2003) 73 The court was quoting from Scan Inc. The courts reasoned that the defendants did not manifest an intent to engage in business or other interactions in Virginia. none from Virginia.198 LAW OF ELECTRONIC COMMERCE This foreshadowed action may have been politic. (2) with the manifested intent of engaging in business or other interactions within the State. the 4th Circuit Appeals Court in the United States handed down its decision in Young v New Haven Advocate. The effects test in Calder v Jones was applied. Connecticut with a small number of subscribers. 3d 707. . 74 Young v New Haven Advocate 315 F.

com v Northwest Healthcare Alliance75 the US Supreme Court declined an opportunity to clarify the jurisdiction test when it denied certiorari without opinion.com has purposefully interjected itself into the Washington state home health care market through its intentional act of offering ratings of Washington medical service providers.78 However. and defendant could reasonably expect to be called to account for its conduct in the forum where it understood the effects of its action would be felt. and where plaintiff’s reputation is likely to suffer if in fact it has been injured by defendant’s actions.com. in a defamation action arising out of statements found on defendant’s website that caused injury to the plaintiff in Washington. a Delaware corporation with its principal place of business in Colorado. the Federal Court accepted a test implicitly identical to the effects test in Calder v Jones. it can be argued that its application to the facts is identical: a newspaper. where plaintiff has its principal place of business. its impact has been limited. The Appeals Court approved and applied the effects test of Calder v Jones:76 We find that defendant Healthgrades. While the underlying reasoning in HealthGrades and Young v New Haven appears to differ. since defendant was well aware that its rating of Washington home health care providers would be of value primarily to Washington consumers . implicitly if not expressly. Plaintiff’s claims arise from that out-of-state conduct. . even if published on the internet. to subscription websites. 01-35648 (9th Cir 2002). may be aimed at a local audience. The court held that the use of a trade mark on the internet. and a healthcare rating service is aimed wherever the rated health care providers are located. This act was expressly aimed at plaintiff’s forum state. therefore. without more. Finally. See above. Though the Dow Jones case caused international concern. of defendant’s out-of-state conduct were felt in Washington. [2005] FCA 471. uploaded on a website outside of Australia. the allegedly defamatory rating received by plaintiff on defendant’s website concerned the Washington activities of a Washington resident. . Therefore that case is of no assistance to the Ward Group. The effects. para 42. is not a use by the website proprietor of the mark in each jurisdiction where the mark is downloaded. However: 75 76 77 78 No.JURISDICTION 199 In Healthgrades. The 9th Circuit Court of Appeals held that Washington State courts may exercise personal jurisdiction over Healthgrades. including the Washington-based plaintiff. . the brunt of the harm allegedly suffered by plaintiff occurred in Washington – where plaintiff is incorporated. [2005] FCA 471. In Ward Group Pty Ltd v Brodie & Stone Plc77 the Federal Court of Australia distinguished the Dow Jones case: As the allegedly defamatory publication was made available to subscribers in Victoria on the Internet. no issue arose about the publication of that material in Victoria. The statements were ratings of home healthcare providers.

That principle was confirmed by the English Court of Appeal in Loutchansky v Times Newspapers Ltd (Nos 2–5). published an article about the floating of shares by Harrods. para 43. In refusing relief. In the United Kingdom and Australia each publication gives rise to a separate cause of action. the judge held that granting authority to enjoin foreign lawsuits should be done sparingly and only with care and restraint. 83 [2002] HCA 56. . 80 Dow Jones & Co. para 57. was approved by Kirby J in Dow Jones v Gutnick. . Dow Jones argued that a declaratory judgment was appropriate in that it would free them from ‘vexatious and oppressive’ litigation abroad. seeking to block the action. it is circulated’.82 that a single publication rule could only be introduced throughout Australia by statute. not one law’. Single publication rule Most US states have adopted a single publication rule which treats all sales of a defamatory book or newspaper as a single publication. In the US case Judge Marrero said that Dow Jones was eager to avoid a British trial because Britain’s libel laws were far more friendly to plaintiffs. a particular jurisdiction then there is likely to be a use in that jurisdiction when the mark is downloaded. Dow Jones filed suit in the Southern District of New York. through its publication the Wall Street Journal. . Inc. or directed or targeted at. See Debra Cohen.84 Dow Jones described the Australian position as ‘primitive’. 81 [2002] QB 783. once the website intends to make and makes a specific use of the mark in relation to a particular person or persons in a jurisdiction there will be little difficulty in concluding that the website proprietor used the mark in that jurisdiction when the mark is downloaded. Of course. emphasis added. 84 [2002] HCA 56. or the number of states in which. 237 F. para 127.80 In a declaratory judgment.81 Samuels JA’s observation in Australian Broadcasting Corporation v Waterhouse. to be a single communication regardless of the number of people to whom. 2d 394 (SD NY 2002). 82 (1991) 25 NSWLR 519. The time of the single publication (download) is fixed as the time of the first publication.79 In what began as an April Fools Day joke. Judge Marrero expressed concern that any relief granted by the New York Court would nevertheless be subject to recognition and enforcement in the United Kingdom.83 In the same case Gaudron J described the single publication rule as ‘a legal fiction which deems a widely disseminated communication . claiming that the article caused serious damage to the company’s reputation. 79 [2005] FCA 471. ‘The single publication rule: One action. v Harrods Ltd. Dow Jones. (1966) 62 Brooklyn Law Review 921. with the headline ‘The Enron of Britain?’ Action was commenced by Harrods in England. Supp.200 LAW OF ELECTRONIC COMMERCE if there is evidence that the use was specifically intended to be made in.

However.. The court ruled that without a ‘substantial’ publication in England. [2003] EWHC 1162. which provides that a defendant should only be sued in the place of the first publication of the defamatory material. ‘would publishers. Substantial publication Jurisdiction was not taken by the English courts in Jameel v Dow Jones & Co. . do otherwise?’85 Gleeson CJ.88 where Dow Jones published the article ‘WAR ON TERROR. he asked. technical evidence showed that only five subscribers had actually accessed the article. on the grounds that that view ‘cannot withstand any reasonable test of certainty and fairness’. Uniform defamation legislation – choice of law From 1 January 2006. The other two subscribers had no knowledge of or connection to Jameel. in all states and territories in Australia except the Northern Territory. and that three of those five were associated with Jameel. legislation for uniform defamation law commenced:89 85 86 87 88 89 [2002] HCA 56. finding instead that if a target of a publication is based in England. or first published. The Australian position on the position of the limitation period is yet to be determined. 775 NE 2d 463 (2002). such as the place where the matter is provided. See Chapter 12. Although there were 6000 online subscribers to the Wall Street Journal. allegedly defaming Yousef Jameel. The Northern Territory’s uniform legislation commenced on 26 April 2006. Why. Inc. [2005] EWCA Civ 75. Inc.JURISDICTION 201 Callinan J rejected Dow Jones’ submission that publication occurs at one place. In Harrods Limited v Dow Jones & Co. Nevertheless jurisdiction was granted to protect a reputation in England. McHugh. then an online or offline publisher can be brought before the UK courts. His Honour rejected the single publication rule. owing duties to their shareholders to maximise profits. List of Early al Qaeda Donors Points to Saudi Elite. Charities’ in the Wall Street Journal. Jameel was unable to prove ‘substantial harm’. para 199. there could have been no damage to Jameel’s reputation. a Saudi businessman.87 Justice Eady noted the limited amount of publication in England (only 10 copies of the Wall Street Journal) and that there were very few English hits to the Wall Street Journal website. he expressed concern that publishers would set up in a ‘defamation free jurisdiction’ or one in which the defamation laws are tilted towards defendants. Gummow and Hayne JJ noted that in Firth v State of New York86 the New York Court of Appeals decided that the one-year statute of limitation in New York runs from the first posting of defamatory matter upon an internet site and that the single publication rule applies to that first posting.

In the absence of an unusual feature involving the internet as the medium of choice. Where the internet is central to a dispute. and Civil Law (Wrongs) Act 2002 (ACT) s123. Where the internet is used peripherally – for example. consideration should be given to the effect of non-internet factors. . 91 See Effects test. (3) In determining the Australian jurisdictional area with which the harm occasioned by a publication of matter has its closest connection. Defamation Act 2005 (Qld) s11. and (d) any other matter that the court considers relevant. the substantive law that is applicable in that area must be applied in this jurisdiction to determine any cause of action for defamation based on the publication. (2) If there is a multiple publication of matter in more than one Australian jurisdictional area. where conduct remains in a single. Defamation Act 2005 (Vic) s11. The mere possibility of access to a website should be insufficient grounds for jurisdiction.91 Conclusion The application of traditional rules has proved appropriate for cases such as Bensusan and Macquarie Bank. courts should apply the usual principles for jurisdictional questions. above. should be disregarded. and (c) the extent of harm sustained by the plaintiff in each relevant Australian jurisdictional area. in the case of a corporation that may assert a cause of action for defamation. The courts should adopt the distinction between passive and active sites. geographical location – the mere use of the internet should not complicate the application of the jurisdictional principles. and (b) the extent of publication in each relevant Australian jurisdictional area. Similarly. Any peripheral effect of the internet should be disregarded unless it is central to the dispute. The greater the degree of interactivity the greater the likelihood that the site’s owner is engaging.90 Subsection (2) in particular assist in determining jurisdiction within Australia. the mere viewing of a site. Defamation Act 2006 (NT) s10. the substantive law applicable in the Australian jurisdictional area with which the harm occasioned by the publication as a whole has its closest connection must be applied in this jurisdiction to determine each cause of action for defamation based on the publication. the place where the corporation had its principal place of business at that time. Quite often there are a number of factors involved in a given dispute. including the use of the telephone and mail. a court may take into account: (a) the place at the time of publication where the plaintiff was ordinarily resident or. Defamation Act 2005 (WA) s11.202 LAW OF ELECTRONIC COMMERCE Choice of law for defamation proceedings (1) If a matter is published wholly within a particular Australian jurisdictional area. Defamation Act 2005 (SA) s11. Defamation Act 2005 (Tas) s11. This provision is in part a codification of the ‘effects test’ postulated in the US case of Calder v Jones. as opposed to engaging in some further interaction. specific. or should be 90 Defamation Act 2005 (NSW) s11.

Proof of use and of impact are necessary for jurisdiction to be granted. International Shoe Co.92 The effect of action by the defendant and its likelihood to result in harm to a known target will also affect the courts’ reasoning in taking jurisdiction. The typical website is open to the world. expected and foreseeable consequences of those uses. the computer and server become complicating factors. rumour and speculation to be published as an assertion of fact by anonymous contributors’ (para 55). 93 For example. Correspondingly. Further reading Anonymous. he or she should be more likely to be subject to that jurisdiction. where it is reasonable to assume use and access by subscribers. the location of the recipient. in commerce with the user.93 Distinctions will continue to be made between the intended. If courts take jurisdiction too broadly or recklessly there should be legislative intervention to impose a fairness requirement similar to the approach taken in the US cases. 92 In relation to due process and the 14th Amendment. Discussion forums or bulletin boards may similarly be open or closed. Australian Football League v Age Company Ltd [2006] VSC 308 involved a discussion forum. gossip. Debra. Cohen. trivia. .JURISDICTION 203 aware that he or she is engaging. The development of the internet permits various uses. v Washington 326 US 310. not one law’. The Victorian Supreme Court described the discussion forum as enabling ‘opinions. and evidence of use and access within a court’s jurisdiction is necessary before that court will grant jurisdiction. Electronic mail is less of an issue as it is typically targeted. ‘The single publication rule: One action. The same cannot be said of subscription websites. where the site owner purposefully avails himself or herself of the benefits of commerce from that jurisdiction. Nevertheless. (1966) 62 Brooklyn Law Review 921. (2004) 117 Harv L Rev 1617. ‘A “category-specific” legislative approach to the internet personal jurisdiction problem in US law’.

The notion of the internet as the last bastion of free speech has produced a general mindset that the laws that bind and regulate social behaviour should not apply in that space. an international financial magazine. See Chapter 11. However. and so no one set of common elements that need to be satisfied in all jurisdictions. but balance these rights and freedoms with considerations of unlawful interference. Articles 17 and 19 of the UN International Covenant on Civil and Political Rights (ICCPR) provide for both freedom of expression and the right to hold opinions. there has developed a sense that anything written in an electronic forum should somehow be immune from oversight and censure.) According to Kirby J: any development of the common law of Australia.2 (The case concerned the reputation of a Melbourne-based businessman. privacy and the protection of honour and reputation. Joseph Gutnick. 204 . who alleged that the Dow Jones corporation defamed him by publishing an article titled ‘Unholy Gains’ in Barrons. There is no universal definition of defamation. Courts internationally have disagreed with this view. To the extent that our law does not do so. consistent with such principles.1 These articles were considered and applied by Kirby J in the internet defamation case of Dow Jones v Gutnick. should provide effective legal protection for the honour. 2 [2002] HCA 56. the laws that have been most challenged relate to intellectual property rights. Barrons could be purchased in hardcopy or readers could subscribe online. Arguably. particularly in the realm of defamation. the boundaries of appropriate and acceptable behaviour on the internet have been challenged. like 1 See Chapter 11. reputation and personal privacy of individuals.12 Defamation in cyberspace From the beginning. Australia.

Defamation Act 2005 (Tas) s26. with freedom of speech. to some extent. 575. Defamation Act 2006 (NT) s23. While the ‘truth’ of defamatory remarks has generally been held to be a defence to defamation suits. See also Chakravarti v Advertiser Newspapers Ltd [1998] HCA 37. (1998) 193 CLR 519. in the north American and UK jurisdictions. (2) that mere composition and writing of words is not enough to constitute the tort. such as its effect on reputation. Civil Law (Wrongs) Act 2002 (ACT) s136.DEFAMATION 205 other nations so obliged. in a philosophical sense. 6 [2002] HCA 56. Defamation law in cyberspace will be tested in the courts and the interface between the law and the internet will continue to be built. is rendered accountable to the relevant treaty body for such default. and (4) that a publisher is liable for publication in a particular jurisdiction where that is the intended or natural and probable consequence of its acts. 4 Defamation Act 2005 (Qld) s26. . and the public disclosure of malfeasance. Defamation Act 2005 (SA) s24.5 This chapter will provide an overview of the legal position regarding online defamation in Australia and. 5 See Chapter 11.7 3 [2002] HCA 56. the framing of political debate. Defamation principles Kirby J in Dow Jones v Gutnick6 restated defamation principles in the following terms: First.3 The laws dealing with defamation have always struggled.4 the burden of proof for establishing truth has occasionally been shown to be so onerous as to destroy any protection afforded by this defence. as these have all in some ways always inherently contradicted the rights of protection afforded by the principles of defamation. Defamation Act 2005 (Vic) s26. The opportunity for a significant body of ‘e-defamation’ case law to develop has been limited. Any discussion of the law of defamation in cyberspace must be conducted in conjunction with a discussion of jurisdictional issues in cyberspace. a starting point for the consideration of the submission must be an acceptance that the principles of defamation law invoked by the respondent are settled and of long standing. Defamation Act 2005 (NSW) s26. para 116. the plaintiff has a new cause of action. Those principles are: (1) that damage to reputation is essential for the existence of the tort of defamation. freedom of the press. Many jurisdictions are struggling with content-specific issues of cyberspace and have yet to address the implications of content. (3) that each time there is such a communication. Defamation Act 2005 (WA) s26. 7 [2002] HCA 56. those words must be communicated to a third party who comprehends them. para 124.

copying. and this distinction persists in some jurisdictions. 10 Defamation Act 2005 (Qld) s32(3)(f )(i) and (ii). Defamation Act 2006 (NT) s29(3)(f )(i) and (ii). highlight the need for the defence of ‘innocent dissemination’ to be drafted in such a way as to ‘ensure that the defence takes proper account of modern means of mass communication and the problems associated with its monitoring’. Defamation Act 2005 (SA) s30(3)(f )(i) and (ii). Defamation Act 2005 (WA) s32(3)(f )(i) and (ii). Defamation Act 2005 (NSW) s32(3)(f )(i) and (ii). distributing or selling of any electronic medium in or on which the matter is recorded or the operation of. with careful drafting to ensure that the defence takes proper account of modern means of mass communication and the problems associated with its monitoring. All state and territory jurisdictions recently reformed their statutes in order ‘to ensure the law of defamation within the State(s) . not at codifying the existing case law. Defamation Act 2005 (Vic) s32(3)(f )(i) and (ii). by means of which the matter is retrieved. None dealt specifically with online defamation.206 LAW OF ELECTRONIC COMMERCE Defamation reform The law of defamation in Australia is provided by state and territory legislation. . Until recently it has differed quite significantly between jurisdictions. distributed or made available in electronic form’. Defamation in cyberspace – actions and issues It has been established by both Australian courts and courts in other jurisdictions that a person may be defamed in an online forum and that damages may be awarded. Civil Law (Wrongs) Act 2002 (ACT) s139C(3)(f )(i) and (ii). copied. any equipment. particularly in terms of the elements that need to be satisfied to establish an action for defamation. The term ‘defamation’ has historically been a composite tort expression encompassing both slander and libel. The Working Group of State and Territory Officers that created the reform proposals did. however.9 This has been reflected in the legislation by provisions that exempt from the definition of ‘primary distributor’ those who provide services for ‘the processing. (2004) Proposal for Uniform Defamation Laws. The revised statutes do not affect the operation of the precedents already in law except to the extent that the statutes specifically provide. . is uniform in substance with the law of defamation in all Australian jurisdictions’. Defamation Act 2005 (Tas) s32(3)(f )(i) and (ii). The decision of the Supreme Court of Western Australia in 1993 in 8 Standing Committee of Attorneys-General (SCAG) Working Group of State and Territory Officers. each of these being separate torts for verbal and written defamation respectively. system or service. 9 Recommendation 12: The common law defence of innocent dissemination should apply. or the provision of. .10 These reforms were specifically aimed at standardising the legislative response to the case law across all state and territory jurisdictions. Legislation and Policy Division of the NSW Attorney General’s Department.8 One of the reforms provides for the abolition of the distinction between spoken and published defamation.

the broader reach can affect the amount of damages. has a broad reach. ● information placed on web pages. Civil Law (Wrongs) Act 2002 (ACT) Part 9. If a person merely repeats another’s defamatory statement. the impact on defamation actions is likely to be the same. This means that when defamatory material on the internet is downloaded and read. 12 See The Buddhist Society of Western Australia Inc. It is often the case that the authors of defamatory statements are protected from legal proceedings by their impecuniosity. and radio and television stations also place videos.12 In the Australian context. 14 See McLean v David Syme & Co. magazines and media outlets republish their material online. This is often unsuccessful because the law in many jurisdictions allows a publisher or disseminator protection through the principle of ‘innocent dissemination’. v Bristile Ltd [2000] WASCA 210. In Australia. this is likely to remain so given that the defamation reforms of 2006 specifically provide for an ‘offer of amends’ process that must precede formal litigation. it is an additional mode of communication: many newspapers. Defamation Act 2005 (Vic) Part 3. a new and separate cause of action arises. sound and video. online publication of new material. a new cause of action arises. Publication can occur through: ● the sending and redistribution of emails. ● chat rooms. Electronic publications using the internet increase the scope of defamation actions in three ways. These actions can occur easily and unintentionally. case 1994 of 1993. the innocent dissemination defence appears in every state and territory jurisdiction: 11 (1993) Unreported decision of the Supreme Court of Western Australia. Defamation Act 2005 (SA) Part 3. 13 Defamation Act 2005 (Qld) Part 3. ● postings to bulletin boards. Limited (1970) 72 SR (NSW) 513.13 Historically. a separate cause of action arises each time defamatory material is published (see Single publication rule.3. however. Third. news groups or discussion lists. Such ‘innocence’ is greatly qualified. First. In Australia. There have been few defamation actions related to online publication to date. . The decision did not advance principles of online defamation but the award of $40 000 in damages for untrue allegations of paedophilia demonstrated that a person can be held liable for statements made in the public space of the internet. and can reach a large and indeterminate audience. Defamation Act 2005 (Tas) Part 3. including material that is otherwise intended to be relatively private. Defamation Act 2005 (WA) Part 3. below).DEFAMATION 207 Rindos v Hardwick11 was the first internet-based defamation determination in any jurisdiction. and defendants using this defence have a high evidentiary burden in many jurisdictions. and ● files that are made available for downloading. sound files or transcripts online. the introduction of such alternative dispute resolution mechanisms has resulted in a reduction in litigation.14 so employees who forward defamatory emails may also be liable. those damaged may then seek out a party more likely to be able to meet any damages awards. Defamation Act 2005 (NSW) Part 3. Defamation Act 2006 (NT) Part 3. including text. Second.

Defamation Act 2005 (Tas) s32. Prodigy Services Co. (3) Without limiting subsection (2)(a). or (f ) a provider of services consisting of: (i) the processing. Civil Law (Wrongs) Act 2002 (ACT) s139C. reprints or reproduces or distributes the matter for or on behalf of that other person. a communications system by means of which the matter is transmitted. distributed or made available in electronic form. and (b) was not the author or originator of the matter. Defamation Act 2005 (SA) s30. copying. This censorship was 15 Defamation Act 2005 (Qld) s32. . radio or otherwise) containing the matter in circumstances in which the broadcaster has no effective control over the person who makes the statements that comprise the matter. 16 1995 WL 323710 (NY Sup Ct 1995). Defamation Act 2005 (NSW) s32. or (h) a person who. Defamation Act 2005 (Vic) s32. or (g) an operator of.208 LAW OF ELECTRONIC COMMERCE Defence of innocent dissemination (1) It is a defence to the publication of defamatory matter if the defendant proves that: (a) the defendant published the matter merely in the capacity. copied. Unlike most providers. Prodigy sought to differentiate itself in the market by providing a degree of censorship on the site. v Prodigy Services Co. by means of which the matter is retrieved.16 the innocent dissemination defence was disallowed in the Supreme Court of New York. Defamation Act 2005 (WA) s32. nor ought reasonably to have known. or made available.. of a subordinate distributor. system or service. and (b) the defendant neither knew. or (c) a wholesaler or retailer of the matter. (2) For the purposes of subsection (1).15 In Stratton Oakmont Inc. on the instructions or at the direction of another person. a person is a ‘subordinate distributor’ of defamatory matter if the person: (a) was not the first or primary distributor of the matter. or (ii) the operation of. or as an employee or agent. (Prodigy) was an online provider of a website that offered internet forum services to subscribers. or (e) a broadcaster of a live programme (whether on television. and (c) the defendant’s lack of knowledge was not due to any negligence on the part of the defendant. and (c) did not have any capacity to exercise editorial control over the content of the matter (or over the publication of the matter) before it was first published. or a provider of access to. newsagent or news-vendor. Defamation Act (NZ) s8. or (d) a provider of postal or similar services by means of which the matter is published. prints or produces. a person is not the first or primary distributor of matter merely because the person was involved in the publication of the matter in the capacity of: (a) a bookseller. or the provision of any equipment. by another person over whom the operator or provider has no effective control. Defamation Act 2006 (NT) s29. that the matter was defamatory. distributing or selling of any electronic medium in or on which the matter is recorded. or (b) a librarian.

3d 510. however. Prodigy did not advertise the limitations of its censorship role. mostly profanities. CompuServe did not exercise any editorial control over the online forum content. ‘Wikimmunity: Fitting the Communications Decency Act to Wikipedia’.18 In Cubby v CompuServe. and that no practical or principled distinction can be drawn between active and passive use.DEFAMATION 209 minimal.. Supp. Until Congress chooses to revise the settled law in this area. This section excludes administrators. One interpretation appeared to be that any control over the content to be disseminated would make the administrator liable.17 Critics of the section claim that it is too broad. section 230(c)(1) of the Communications Decency Act 1996 (US) effectively overturned this restrictive interpretation of the Prodigy decision: No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.19 CompuServe was the administrator for an online forum. the fact that they practised some editorial control and informed users of that meant that they were liable for the defamation and could not claim innocent dissemination. but did not specifically find. comprising only a software-driven review of content for a preset range of specific words. . We further hold that section 230(c)(1) immunizes individual ‘users’ of interactive computer services. However. the court was asked to determine the extent to which Prodigy’s limited censorship program constituted editorial control. but it is yet to be repealed or modified. 19 776 F. In Barrett v Rosenthal the court stated (in obiter): We conclude that section 230 prohibits ‘distributor’ liability for Internet publications. ISPs and other service providers from liability for defamatory statements made by users of public systems unless they know of defamatory material and fail to take action on it. Administrators and Internet Service Providers (ISPs) thus often chose not to censor sites to avoid liability. The court intimated. When one of Prodigy’s site users posted defamatory material in a forum about Stratton Oakmont Inc. The court determined that while Prodigy in fact had no specific knowledge of the defamatory content. that electronic publishers ought not be found liable for content on sites hosted on their servers in these circumstances: 17 Ken S Myers. (2006) 20 Harvard Journal of Law and Technology 163. 18 (2006) 40 Cal 4th 33. plaintiffs who contend they were defamed in an Internet posting may only seek recovery from the original source of the statement. unlike Prodigy. or are themselves involved in either the creation or development of the material. We acknowledge that recognizing broad immunity for defamatory republications on the Internet has some troubling consequences. In the United States. 135 (SD NY 1991). There was some initial misinformation regarding the Prodigy decision. 146 P.

create. material placed online two years ago may only come to the attention of the general public after some form of publicity or report in the news. unlike other forms of publication.210 LAW OF ELECTRONIC COMMERCE [the] requirement that a distributor must have knowledge of the contents of a publication before liability can be imposed for distributing that publication is deeply rooted in the First Amendment. 135 (SD NY 1991). made applicable to the states through the Fourteenth Amendment. . internet publication is continuous: 24 hours a day. Also.23 The difficulty in relation to online publication is that. . 22 706 NYS 2d 835. A rule of convenience has developed to treat these multiple actions as one. to be a single 20 776 F. a defamatory utterance or publication arises each time a newspaper or book is sold or read. Limitation Act 1950 (NZ) s4 provides for a two year limitation period with a maximum extension to four years. In Australia the limitation for commencing legal proceedings is one year from publication. seven days a week. review. Limitation of Actions Act 1958 (Vic) s23B. 24 Limitation Act 1969 (NSW) ss14B and 56A. or separately in the homes of each person who hears or views a radio or television broadcast. Limitation Act 2005 (WA) ss15 and 40(3). Cubby also sought to hold CompuServe vicariously liable for the libel. 21 Ibid. Limitation Act 2005 (NT) ss12(2)(b) and 44A(2). Limitation of Actions Act 1974 (Qld) ss10AA and 32A. The rule has been described as ‘a legal fiction which deems a widely disseminated communication . Statute of limitations The question of precisely when a defamatory tort occurs (for the purposes of deciding when a Statute of Limitation commences to operate) was addressed by the New York Court of Appeals in Firth v State of New York22 and considered by the High Court of Australia in Dow Jones v Gutnick. In Australia the question has not definitively been decided. delete. Limitation Act 1985 (ACT) s21B(1) and (2). edit and otherwise control the contents’21 of the forum on which the offensive material appeared. Defamation Act 2005 (Tas) s20A(1) and (2). with extensions of up to three years in limited circumstances. Single publication rule Strictly speaking. but the court held there to be no agency between the defendant and the other parties to the libel. 23 [2002] 210 CLR 575 at 602–603. Supp.20 CompuServe’s defence was aided by the fact that the system operators for their online forums were independent entrepreneurs who were contracted to ‘manage. Limitation of Actions Act 1936 (SA) s37(1) and (2).24 The US court held that the statute runs from the first posting of the defamatory article onto an internet site. 136. .

where the defamatory matter was published in a book or newspaper. . or the number of states in which. Similarly. not one law’. in locations all over the world. As a continuous publication. at least in some American States by the late nineteenth century. See Chapter 11.’ Despite this difference in the context in which the question of location arose. however.27 In Firth v State of New York28 the court noted that the rationale behind the single publication rule was even more applicable to the internet. This is to be distinguished from the issue of a new edition of a book. 26 [2002] 210 CLR 575. The expression ‘one publication’ or.25 Applying this principle to internet web pages is a minefield. comprehensively.26 Gleeson CJ. . may neither be possible nor productive. 25 Debra Cohen. The source of this added proposition was given as a case of prosecution for criminal libel where the question was that raised by the Sixth Amendment to the United States Constitution and its reference to the ‘state or district wherein the crime shall have been committed. It was against this background that there emerged. ‘The single publication rule: One action. 27 [2002] 210 CLR 575.DEFAMATION 211 communication regardless of the number of people to whom. American courts accepted that. which is sold to a new and different readership. In the early decades of the twentieth century. ‘single publication’ was first commonly used in this context. heard or viewed at completely different times. later. it is circulated’. the origins of the so-called single publication rule . McHugh. The court regarded unrelated modifications to the website as insufficient to restart the one year limitation period. the defamatory statement may be read. (1966) 62 Brooklyn Law Review 921. In their joint judgment in Dow Jones v Gutnick. proof of general distribution of a newspaper was accepted as sufficient proof of there having been a number of separate publications. the statement that the place of publication was where the newspaper or magazine was published was sometimes taken as stating an element of (or at least a consequence of) the single publication rule applied to civil defamation suits. as there is greater potential there for multiple triggerings of the statute of limitations as well as for multiple suits and vexatious actions. the rule that a plaintiff could bring only one action against a defendant to recover damages for all the publications that had by then been made of an offending publication. each publication need not be pleaded separately. 924. To trace. paras 33–34. 28 706 NYS 2d 835. the single publication rule came to be coupled with statements to the effect that the place of that single publication was the place where the newspaper or magazine was published. Following early English authority holding that separate counts alleging each sale need not be pleaded in the declaration. perhaps over a number of years. Treating each sale of a defamatory book or newspaper as a separate publication giving rise to a separate cause of action might be thought to present difficulties of pleading and proof. It is. Gummow and Hayne JJ considered the single publication rule and its development in relation to the place of publication. . useful to notice some of the more important steps that have been taken in its development.

slander.30 An article published online was alleged to have defamed two Russian businessmen residing in Britain. The Uniform Single Publication Act is legislation that becomes law when a state enacts it. Second. he concluded that the court could not justify changing the rules of Australian common law merely as a response to the Dow Jones submission. [2000] UKHL 28. Recovery in any action shall include all damages for any such tort suffered by the plaintiff in all jurisdictions. First. The court stated that English law could find ‘no support for this argument’ but then reiterated their support for the long-established legal principle that ‘each publication is a separate tort’. The court expressed concerned that applying a single publication rule for internet-based defamation (in Australia) would in effect differentiate such defamation from all other types of defamation.212 LAW OF ELECTRONIC COMMERCE The principle of the single publication rule is codified in legislation only in the United States. the most appropriate forum was the United States. . including that Victoria was not a ‘clearly inappropriate forum’ to hear the action. exhibition or utterance. Kirby J gave a number of reasons for ‘declining an Internet-specific single publication rule’. and the server upon which the defamatory material was published was also physically located in that country. [2000] UKHL 28. Its aim is to create a template. Their Lordships held that ‘The Uniform Single Publication Act does not assist in selecting the most suitable court for the trial: it merely prevents a multiplicity of suits’. such as any one (1) edition of a newspaper. The High Court disagreed on a number of grounds. The article was published by the Forbes Corporation in hardcopy and on their website. invasion of privacy or any other tort founded upon a single publication. their alteration risks taking the judge beyond the proper limits of the judicial function. The Uniform Single Publication Act (US) provides that multistate defamation must be dealt with in one jurisdiction and that the findings of the court in that jurisdiction are binding on the plaintiff in all other jurisdictions for any single defamatory publication. It has been widely adopted across the United States with very similar wording to this: No person shall have more than one (1) cause of action for damages for libel. any one (1) broadcast over radio or television or any one (1) exhibition of a motion picture. It has not found favour in United Kingdom or Australasian jurisdictions.29 In the United Kingdom the House of Lords was called upon to deal with the single publication rule in the defamation case of Berezovsky v Michaels. book or magazine.31 In the Dow Jones case. Dow Jones sought to persuade the court that as they were incorporated in the United States. [2002] HCA 56. he added: Where rules such as these are deeply entrenched in the common law and relate to the basic features of the cause of action propounded. any one presentation to an audience.32 29 30 31 32 Idaho Single Publication Act s6-702. para 124.

Unfair Publication: Defamation and Privacy. the Court requires the parties to that litigation to bring forward their whole case. even if such reform were warranted. 11. or even accident. inadvertence. The cases to date have not adequately addressed the issues of timing and place.’33 Fourth. and of adjudication by. para. 36 Defamation Act 2005 (Qld) s8. See also Chapter 11. 34 See Australian Broadcasting Corporation v Waterhouse (1991) 25 NSWLR 519 at 537. See also Australian Law Reform Commission.34 In the absence of a specific single publication rule. It was said in Henderson v Henderson that: where a given matter becomes the subject of litigation in. in order to properly determine breach and damages. 319. Report No. he expressed concern about a separate rule for the internet. Defamation Act 2006 (NT) s7. 37 See para 131ff. 115. Defamation Act 2005 (Tas) s8. Single cause rule The single publication rule is not to be confused with the ‘single cause’ provision in the uniform Defamation Acts across Australia. Defamation Act 2005 (WA) s8. 57 paras 6. 33 [2002] HCA 56. Report No. (1992).36 Adventitious or opportunistic conduct In Dow Jones. (1979). . Defamation Act 2005 (Vic) s8. Australian courts have estopped parties from raising the same issue in subsequent litigation. Civil Law (Wrongs) Act 2002 (ACT) s120. Defamation Act 2005 (NSW) s8.35 Single controversy principle Australian courts have de facto adopted a ‘single controversy’ principle: where there are multiple publications of the same defamatory matter there is only a ‘single controversy’ to be litigated. 67 ER 313. which provides that: A person has a single cause of action for defamation in relation to the publication of defamatory matter about the person even if more than one defamatory imputation about the person is carried by the matter. he noted that there would be ‘special difficulties’ in achieving judicial reform of the multiple publication rule in Australian law. Defamation Act 2005 (SA) s8. only because they have. That controversy must include all separate utterances of the defamatory allegation. 60–61. 35 [1843] 3 Hare 100. Australian Law Reform Commission. particularly where internet publication is concerned.37 Dow Jones claimed that permitting jurisdiction in Victoria – that is. both parties raised the issue of adventitious or opportunistic conduct. but which was not brought forward.DEFAMATION 213 Third. omitted part of their case.53–54. a Court of competent jurisdiction. 58. and will not (except under special circumstances) permit the same parties to open the same subject of litigation in respect of matter which might have been brought forward as part of the subject in contest. para 125. stating that ‘Rules should be technology-neutral. from negligence. Defamation Act (NZ) s7 is a similar provision. Choice of Law.

Gutnick’s response was that should a plaintiff improperly attempt to take such an advantage. in this case the United States. v Cansulex Ltd. v Gutnick [2002] 210 CLR 575 at 590. . some 38 [2002] 210 CLR 575. 40 [1987] AC 460. For further details see Chapter 11. He claimed that his choice of venue was not adventitious or opportunistic: Victoria was the place of his residence and his prime business interests. the court declined to refuse the exercise of its jurisdiction.38 The High Court held firm to the Australian legal doctrine that forum non conveniens can only be applied by determining whether or not the Australian forum is ‘clearly inappropriate’.40 Lord Goff described the ‘natural forum’ as being ‘that with which the action had the most real and substantial connexion’. 39 Oceanic Sun Line Special Shipping Co. Dow Jones claimed that its choice of location for the server was not adventitious or opportunistic. v Gutnick’. Dow Jones’ response was a copy of Gutnick’s: should a defendant improperly attempt to take such an advantage. Voth v Manildra Flour Mills Pty Ltd (1990) 65 ALJR 83. . Jurisdiction for defamatory statement To date the definitive online defamation case in Australian jurisprudence remains Dow Jones v Gutnick. In the Dow Jones case. the appropriate and the convenient forum’.41 Conclusion While much of the law dealing with online defamation and other torts committed on the internet is still in its earliest days of development and interpretation. not the medium: Defamation. The High Court reaffirmed its position in Regie National des Usines Renault SA v Zhang (2002) 76 ALJR 551: ‘[a]n Australian court cannot be a clearly inappropriate forum merely by virtue of the circumstance that the choice of law rules which apply in the forum require its courts to apply foreign law as the lex causae’. Henry v Henry (1996) 185 CLR 571.214 LAW OF ELECTRONIC COMMERCE at the place of download rather than the place of upload – would encourage plaintiffs to commence actions in jurisdictions with favourable defamation laws. 41 Dow Jones and Co. v Fay (1988) 62 ALJR 389. Equally. holding that when ‘Victorian law was the lex loci delicti. and thereby have the matter removed to another forum. the applicant must demonstrate under the ‘Spiliada principles’ that their preferred forum. at the place of upload rather than the place of download – would encourage defendants to move their servers to jurisdictions with weak defamation laws. . 478. See David Rolph. publication and the internet in Dow Jones & Co. the courts should consider rejecting jurisdiction. Victoria is the natural forum [and] . See also Macquarie Bank v Berg [1999] NSWSC 526. was the ‘natural forum’ in which to hear the matter. ‘Before the High Court – The massage. Gutnick claimed that permitting jurisdiction in New Jersey – that is. (2002) 24 Sydney Law Review 263. Lord Goff of Chieveley. Inc. Inc. the courts should consider rejecting jurisdiction.39 The burden under this doctrine rests with the applicant. To succeed in this. In Spiliada Maritime Corp.

Ken S Myers.pdf/$file/Uniform+Defamation+States+Territories. the law will be developed and amended to provide direction and protection for those most at risk. (2000) 22 Sydney Law Review. Standing Committee of Attorneys-General (SCAG) Working Group of State and Territory Officers. not the medium: Defamation.DEFAMATION 215 general principles have already emerged. (2000) 49 Duke L J 855. and clear guidelines on the roles and responsibilities of every employee who is exposed to the internet as part of their normal duties. ‘Wikimmunity: Fitting the Communications Decency Act to Wikipedia’. 58. not one law’. David Rolph.au/www/agd/ rwpattach. . The first is that it would appear that for the purposes of mitigating risk. These might include a staff training r´gime. Lyrissa Barnett Lidsky. www.pdf. As the law develops.gov. (2002) 24 Sydney Law Review 263. Uta Kohl. Australian Law Reform Commission. Report No. it is wiser for forum providers to not provide any editorial control whatsoever – and to advertise this fact widely. Proposal for Uniform Defamation Laws. 11. ‘Defamation on the internet – A duty free zone after all? Macquarie Bank Ltd & Anor v Berg’. v Gutnick’. Next. (1966) 62 Brooklyn Law Review 921. ‘Silencing John Doe: Defamation & discourse in cyberspace’. Debra Cohen. ‘Before the High Court – the massage. (1979) Unfair publication: Defamation and privacy. Further reading Australian Law Reform Commission. ‘The single publication rule: One action. a compulsory e Code of Conduct. Legislation and Policy Division of the NSW Attorney General’s Department. and both governments and industry groups better understand their rights and responsibilities in this domain. Report No.ag.nsf/VAP/(03995EABC73F94816C2AF4AA2645824B)∼Uniform+Defamation+States+Territories. employers would be well advised to ensure that there are rigorous and effective systems in place to prevent employees from putting the firm into a defensive position. publication and the internet in Dow Jones & Co Inc. (2006) 20 Harvard Journal of Law and Technology 163. (1992) Choice of law. (2004).

1 See Mark Berthold. 2 Michael Kirby. an attempt to pass a Privacy Act failed because it set in place an anti-privacy provision: a central national identification card. communities. 216 . However. protectionists may accept such erosions for the greater good in the name of law and order. creating an index that handles several million enquiries per day. (1996) PLPR 44 and Graham Greenleaf. False.13 Privacy and data protection in cyberspace ‘Privacy’ has numerous meanings. The development of technology. their role is in fact to ensure and balance security issues and the proper protection of the privacy rights of the individual. including privacy. terrorists and drug users’.1 Such a process would have allowed the government to access and decipher all encrypted files. Historically. In the 1990s the Clipper Chip was proposed by the US government. together with social. It is an aspect of freedom and human rights. governments seem to have pursued increasing and systemic invasions of privacy in the name of law and order. In Australia in 1984. and its importance varies greatly among individuals. (1996) PLPR 22. ‘Regulating surveillance: Hong Kong’s proposals’. ‘Privacy in cyberspace’. robots and wanderers to trawl the internet gathering data on several billion websites. ostensibly for the purpose of allowing the government to override individual encryption to protect society from ‘gangsters. has raised the antennas of those concerned with interference from governments. organisations and governments. Individuals are often surprised by the digital persona visible when their name is searched. (1998) 21(2) UNSW LJ.2 Search engines such as Google use sophisticated programs called spiders. enterprises and others on personal freedoms. This challenges notions of fundamental human rights. Civil libertarians may believe that our actions and behaviour should not be subject to public or governmental scrutiny. ‘OECD searches for crypto-consensus’. economic and political factors. The proposal was unsuccessful. fighting crime and terrorism.

Electronic communication and storage of data have a real impact on issues of privacy and censorship. Considerable time could be spent gaining access.’ 6 Adopted and proclaimed by General Assembly Resolution 217A (III) of 10 December 1948. Hardcopies could deteriorate. may respond to another body’s request for information by transmitting its entire 3 EPP v Levy [2001] NSWSC 482. destroyed or misfiled. with the right to free expression. according to precedent. and cultural and sovereign diversity are others. the communication of ideas and notions of individual liberty (which are themselves important human rights). But those barriers are. in my view. One body. I regard everything which is accessible through resort to the internet as being in the public domain. Such values are not the only human rights: see the Universal Declaration of Human Rights. information wants to be expensive. both of which should. para 22.6 There are other fundamental human rights which compete. pornography. Data could be lost. It is true that someone can obtain that information only if they have access to a computer which has a modem which connects to an internet service provider who. The right to privacy and to reputation and honour. no more challenging or significant in today’s Australia. or conflict. the integrity of financial markets and tax systems. The full quote is: ‘On the one hand. Organised crime. Retrieving data stored in hardcopy form involved time and expense. and the confidentiality of communications must also be protected. Previously. . Our privacy was protected only by the fact that methods of data storage were impractical and inconvenient. provides a connection to the internet. A consequence of this massive index of the internet creates dataveillance. terrorism. intellectual property rights. These so-called safeguards have evaporated in the digital age. The right information in the right place just changes your life. complete with internet cafes.4 Information wants to be free This is the catchcry of the digital age. many of the safeguards of our privacy were in fact only the costs of retrieving personal information. See also Duchess of Argyle v Duke of Argyle [1967] Ch 302 and G v Day [1982] 1 NSWLR 24. So you have these two fighting against each other. for a fee. than those involved in access to a newspaper or television content. 5 An aphorism attributed to Stewart Brand from the First Hackers Conference in 1984. In the world of the internet. Many data collections were incompatible. On the other hand. information wants to be free because the cost of getting it out is getting lower and lower all the time. per Barrett J. technological capacity tends to favour the spread of information. less cognisant of privacy issues and more concerned about costs and time. In 2001 the NSW Supreme Court3 expressed its view on the expectation of privacy or confidentiality when information is placed on the internet: It must be said at the outset that part of the information that the defendants have used is in the public domain. Privacy is only one attribute of the internet in which challenges arise for established values. because it’s so valuable. be seen as involving the public domain. 4 EPP v Levy [2001] NSWSC 482.PRIVACY AND DATA PROTECTION 217 distorted and damaging information may be compiled.5 The absence of a controlling and enforceable law facilitates free expression.

malls. Individuals now have a virtual existence in cyberspace. bodies both public and private are collecting and amassing a greater amount of personal material than ever before. In the Middle Ages only the literate could meaningfully access written information. Only since the advent of electronic recording has information privacy become a serious matter for regulation and control. Due to the ease of storage. Media outlets pay substantial amounts for even blurred long-distance photographs of celebrities. The courts and legislatures failed to recognise inherent concepts of isolation. Privacy dilemmas in the digital world are a Pandora’s Box. Data is now stored in compatible operating systems. Privacy and regulation Privacy can be divided into two broad categories: information privacy and personal privacy. and the quantity of personal information in cyberspace is likely to increase. This is a side of globalisation that is both irreversible and inevitable. seclusion and the protection of personal information. Personal privacy relates to privacy of the person. film and record in public and private places.218 LAW OF ELECTRONIC COMMERCE database. pressing issues such as lawful behaviour – in both criminal and civil senses – and the enforcement of commercial agreements and promises were the priority of lawmakers. . Information privacy refers to the ways in which information is gathered. railway stations and many other places. With government came secrets: national security secrets as well as personal ones. the password or the entire record of an individual rather than a response to the specific request. of an individual’s personal space: it can be ‘invaded’ by those seeking to photograph. The most significant step towards regulation began with the drafting of privacy principles by the Organisation for Economic Co-operation and Development (OECD) in the 1970s. Australian laws permit surveillance cameras in shops. Philosophical concepts such as privacy were insignificant in comparison with survival with warring neighbours and the enforcement of property rights. a digital persona made up of a collection of otherwise unconnected and previously unconnectable data. With literacy came dissemination. it was the Cold War and the perceived need to protect state secrets that pushed cryptography into the limelight as a science. Although crude methods of encryption were developed during World War II. Information privacy As law and society evolved. recorded. accessed and released. In the digital age there are multitudes of records of individuals on databases. service stations.

www.oecd. in the name of privacy protection. The Experts Group was chaired by the Hon Mr Justice Michael Kirby. Denmark. such as banking and insurance’. The OECD observed that privacy protection laws were at that time being contemplated or introduced in OECD countries such as Austria. Iceland. and the abuse or unauthorised disclosure of such data.org. ‘could cause serious disruption in important sectors of the economy. Luxembourg. Electronic commerce law is about the need to find solutions for novel circumstances. Spain.7 then Chairman of the Australian Law Reform Commission (ALRC). Sweden. the Netherlands. The OECD’s major concern was that disparities in national legislation could lead to interruptions in international flows of data and hamper the free flow of personal data across frontiers. 9 Ibid. Canada. and the OECD set up an international Experts Group to draft Guidelines on the Protection of Privacy and Transborder Flows of Personal Data (the OECD Guidelines). France. unjustified obstacles to transborder flows of personal data.PRIVACY AND DATA PROTECTION 219 Modern concepts of information privacy emerged in the late 1970s. Germany. Switzerland and the United States. Norway. the storage of inaccurate personal data. 4 That Member countries agree as soon as possible on specific procedures of consultation and co-operation for the application of these Guidelines.9 7 Former Justice of the High Court of Australia. . The OECD Guidelines were formally adopted and disseminated in September 1980. The OECD Guidelines noted that it was the increase in international data transmission that had made it ‘necessary’ to address privacy protection in relation to personal data. Even in the late 1970s the rapid growth of digital communication was foreseen: automatic data processing that would result in the transmission of vast quantities of data across national boundaries was already being developed. the OECD noted. 8 Preface to the OECD’s Guidelines on the Protection of Privacy and Transborder Flows of Personal Data. Belgium. 3 That Member countries co-operate in the implementation of the Guidelines set forth in the Annex. They included these recommendations: 1 That Member countries take into account in their domestic legislation the principles concerning the protection of privacy and individual liberties set forth in the Guidelines contained in the Annex to this Recommendation which is an integral part thereof.8 including the unlawful storage of personal data. 2 That Member countries endeavour to remove or avoid creating. The OECD supplemented these Guidelines with the Declaration on Transborder Data Flows (1985) and the Ministerial Declaration on the Protection of Privacy on Global Networks (1998). restrictions on these flows. and expressed its concern about new ‘violation[s] of fundamental human rights’.

made available or otherwise used for purposes other than those specified in accordance with Paragraph 9 except: a) with the consent of the data subject. Means should be readily available of establishing the existence and nature of personal data. . destruction. Personal data should not be disclosed. should be accurate. [that] domestic legislation concerning privacy protection and transborder flows of personal data may hinder such transborder flows. Part Two of the Guidelines sets out the key principles: Part Two – Basic Principles of National Application Collection Limitation Principle 7. The preamble to the Guidelines states. to the extent necessary for those purposes. Personal data should be protected by reasonable security safeguards against such risks as loss or unauthorised access. Use Limitation Principle 10. Data Quality Principle 8. . and. in part: Member countries have a common interest in protecting privacy and individual liberties. . Security Safeguards Principle 11.220 LAW OF ELECTRONIC COMMERCE The OECD Guidelines require that personal information not be collected unless the person concerned either consents to its collection or is informed of why it is being collected. and the main purposes of their use. Openness Principle 12. with the knowledge or consent of the data subject. [that] transborder flows of personal data contribute to economic and social development. Purpose Specification Principle 9. where appropriate. Personal data should be relevant to the purposes for which they are to be used. and in reconciling fundamental but competing values such as privacy and the free flow of information. . There should be a general policy of openness about developments. . The purposes for which personal data are collected should be specified not later than at the time of data collection and the subsequent use limited to the fulfilment of those purposes or such others as are not incompatible with those purposes and as are specified on each occasion of change of purpose. complete and kept up-to-date. or b) by the authority of law. . practices and policies with respect to personal data. as well as the identity and usual residence of the data controller. modification or disclosure of data. that automatic processing and transborder flows of personal data create new forms of relationships among countries and require the development of compatible rules and practices. use. . and is informed of who will use it and how the person may access and correct it. There should be limits to the collection of personal data and any such data should be obtained by lawful and fair means and.

in his ABC Boyer Lecture Series. ● marriage [s51(xxi)]. rectified.11 Privacy was not a significant issue for legislators in the immediate postwar period. Morison concluded that privacy was an interest. below. if any. Accountability Principle 14. ● banking [s51(xiii)]. to justify such legislation. However. and to be able to challenge such denial. in section 51. ● divorce and matrimonial causes [s51(xxii)]. While the Australian Constitution makes no direct reference to a privacy right or power. if the challenge is successful to have the data erased. that is not excessive. data relating to him • within a reasonable time.10 Australia In Australia there is no specific right to privacy at common law. it contains sufficient powers. ● postal. An individual should have the right: a) to obtain from a data controller. b) to have communicated to him. telegraphic and telephonic [s51(v)]. commissioned a report into the law of privacy by Professor Morison of the University of Sydney. the NSW Attorney-General. 10 Other Parts are: Part One – General Definitions. The relevant other heads of power in that section include: ● trade and commerce [s51(i)]. and • in a form that is readily intelligible to him. A data controller should be accountable for complying with measures which give effect to the principles stated above. and d) to challenge data relating to him and.PRIVACY AND DATA PROTECTION 221 Individual Participation Principle 13. discussed the real privacy concerns faced by Australians. ● foreign corporations and trading or financial corporations [s51(xx)]. Part Three – Basic Principles of International Application: Free Flow and Legitimate Restrictions. or otherwise. it began to attract attention in Europe and North America. the Australian Computer Society lobbied the government to prevent the perceived imposition of excessive or inappropriate regulation. • at a charge. In 1972. confirmation of whether or not the data controller has data relating to him. 11 See Personal privacy. Concerned at possible legislative overreaction. ● insurance [s51(xiv)]. Part Five – International CoOperation. not a right. . • in a reasonable manner. and in 1969 Zelman Cowen (later Governor General). Part Four – National Implementation. completed or amended. c) to be given reasons if a request made under subparagraphs(a) and (b) is denied. John Madison.

In April 1976. This was intended in part as a replacement of the defeated Australia Card scheme. The Act created a complaints-driven investigative process and a research organisation. The Privacy Act 1988 (Cth) was passed in December 1988. The Privacy Act 1988 (Cth) currently includes 11 Information Privacy Principles14 (IPP) which Commonwealth government departments and agencies are obliged to follow when handling personal information. In 1998. In 1988 the government set out to enhance the Tax File Number (TFN) scheme used by the Australian Tax Office. which was handed down in 1983. financial assistance to the states [s96]. but it was withdrawn after heavy criticism. In 1997. policy and practice for health care workers. Australia’s first Privacy Commissioner was immediately appointed. 13 Data-Matching Program (Assistance and Tax) Act 1990 (Cth). The report. the Australian Privacy Commissioner released a document entitled National Principles for the Fair Handling of Personal Information (FHPI). The Act implements the OECD 12 By way of an amendment to Part VIIC of the Crimes Act 1914 (Cth). social security and other allowances [s51(xxiiiA)]. incidental matters [s51(xxxix)]. This was an application of the OECD Guidelines intended for the wider community. external affairs [s51(xxix)].13 In 1994 New South Wales introduced the Privacy and Data Protection Bill.222 ● ● ● ● ● ● ● LAW OF ELECTRONIC COMMERCE invalid and old-age pensions [s51(xxiii)]. New South Wales enacted the Privacy Committee Act 1975. not to the populace at large. together with rules applicable to the entire community in relation to the handling of tax file number information. took into account the OECD Guidelines. the NSW Health Commission issued a consolidation of privacy law. The Act applied to the public sector. The Act imposes restrictions on how credit providers and credit reporting agencies may handle personal information. In 1986 the government introduced a Privacy Bill which included a controversial national identification card. the Asia Pacific Smart Cards Forum Code of Conduct included privacy principles for members. and public service [s52(ii)]. matters referred by states [s51(xxxvii)]. 14 Privacy Act 1988 (Cth) s14. the Commonwealth government gave the ALRC a reference to study interferences with privacy arising under the laws of the Commonwealth. pre-dating the OECD Guidelines. Subsequent amendments extended coverage to ‘spent’ criminal convictions12 and to data matching. The Bill was defeated by a hostile Senate. In 1996. . Many argued that this was in fact an anti-privacy move. In 1989 the Privacy Act was amended to protect consumers from adverse consumer credit reporting. The work of the latter contributed to establishing information privacy principles for organisations using computers.

family.PRIVACY AND DATA PROTECTION 223 Privacy Principles and observes Australia’s obligations under Article 17 of the ICCPR. individuals have the right to know why an organisation is collecting their personal information. Everyone has the right to the protection of the law against such interference or attacks. ● only use information in ways that: 15 1. They state that an organisation should: ● only collect personal information it actually needs. No one shall be subjected to arbitrary or unlawful interference with his privacy. provided they maintain an equivalent legislative standard. openness (NPP 5). The individual’s rights arise where an ‘act or practice’ results in an ‘interference with privacy’. ● collect information fairly and lawfully. individuals have the right to access this information and correct it if it is wrong. transborder data flows (NPP 9) and sensitive information (NPP 10). with the National Privacy Principles (NPP) made applicable. 16 Privacy Act 1988 (Cth) s13. Individuals can also make a complaint to the Privacy Commissioner if they believe their information is not being handled properly. rather than from other sources. The Privacy Act 1988 (Cth) was significantly extended. 2. data security (NPP 4). they can apply to the Federal Court or the Federal Magistrates’ Court for an order to restrain an organisation from engaging in conduct that breaches the NPP. The IPP continue to apply to the public sector. home or correspondence. identifiers (NPP 7). The 10 NPP are set out in Schedule 3 of the Act and are generally based on the OECD standard. anonymity (NPP 8). Alternatively. what information it holds about them. ● collect information directly from the individual. data quality (NPP 3). section 13A provides that an act or practice of an organisation is an ‘interference with the privacy of an individual’ if the act or practice breaches the NPP. Schedule 3 of the Act sets out the NPP. Under the Privacy Act 1988 (Cth). Section 7 comprehensively defines an ‘act or practice’. .15 The Privacy Act provides that the IPP be treated as law. use and disclosure (NPP 2).16 All firms and businesses need to monitor the changing Australian and international legal environment to ensure that the risk of data protection breaches is minimised. how the information will be used and who else may receive the information. The NPP cover collection (NPP 1). The scheme allows certain organisations to comply with either the NPP or approved industry-developed privacy codes. access and correction (NPP 6). Generally. National Privacy Principles (NPP) In December 2001 the federal government introduced a co-regulatory scheme for information privacy protection for the private sector. nor to unlawful attacks on his honour and reputation. ● let people know what it intends to do with the information it collects.

www. or ● are required by the public interest. and • is not a contracted service provider for a Commonwealth contract (even if the entity is not a party to the contract).20 Acts and practices engaged in by a media organisation in the course of journalism are exempt. stored and disclosed. 20 Privacy Act 1988 (Cth) s7B(3). • does not provide a health service and hold health records. service or advantage.law. a registered political party.18 A small business operator is defined as a business which: • has an annual turnover of three million dollars or less. (2000) ‘Factsheet: Privacy and the electronic environment’. limit its use of government identification numbers (like the Medicare number). be open about how it handles personal information. a partnership. service or advantage to collect personal information.htm. 21 Privacy Act 1988 (Cth) s7B(4). 19 Privacy Act 1988 (Cth) s6D. keep information securely. • does not disclose personal information about an individual for a benefit. a body corporate. or a government agency or instrumentality. a website operator that is classified as an organisation and that collects personal information online to take reasonable steps to ensure that internet users know who is collecting their information and how it is used. 18 Privacy Act 1988 (Cth) s6C. and gives rise to a right to complain to the Privacy Commissioner and a right to seek compensation. The Act broadly defines an organisation as an individual. the individual has consented to. give people access to information about themselves.au/privacy/newfacts/Electronic. for example.gov. these provisions require. only send personal information overseas if it will be properly protected there. and limit its collection of information about people’s race.224 ● LAW OF ELECTRONIC COMMERCE ● ● ● ● ● ● ● ● the individual would expect. religion. ● In a cyberspace context. • is not related to a business with an annual turnover of greater than three million dollars.19 Employee records are exempt if the organisation is or has been an employer of the individual and the act or practice is directly related to the employment relationship. ensure the accuracy of the information. let people operate anonymously where it reasonably can. • does not provide a benefit. sex life or political beliefs. that is not a small business operator. .21 Registered political parties are exempted by 17 See the Attorney General’s Department. any other unincorporated association or a trust.17 A breach of the NPP amounts to an interference with the privacy of an individual.

gov. Part 13 prohibits the disclosure by carriers. to restrict the communication and publication of records of private conversations and to establish procedures for law enforcement officers to obtain warrants or emergency authorisations. carriage service providers and others. However. The Act imposes requirements for the secure storage and destruction of records obtained by police through the use of surveillance devices.au. Privacy Act 1988 (Cth) s7C. Victoria There are several Victorian Acts related to privacy. The Crimes Act 1914 (Cth).vic.25 22 23 24 25 Privacy Act 1988 (Cth) s6C. ● provide individuals with rights of access to information about them held by organisations. .23 Data protection In relation to data protection in Australia.24 The Health Records Act 2001 (Vic) covers the handling of all personal information held by health service providers in the state’s public sector and also seeks to govern acts or practices in the Victorian private health sector.health.vic. local government councillors and their contractors. for any purpose in connection with an election under an electoral law. The Surveillance Devices Act 1999 (Vic) aims to regulate the use of surveillance devices.gov. and ● provide individuals with the right to require an organisation to correct errors. Part VIIC. See the Office of the Victorian Privacy Commissioner: www.privacy.au/hsc/. a referendum or in connection with participation of the member or councillor in an aspect of the political process. a limited form of privacy protection was introduced by the Telecommunications Act 1997 (Cth). Div 5 affords some protection for past criminal convictions. the same Act requires carriers to have wiretapping capabilities in place for ‘lawful’ surveillance. The Act contains a set of principles adapted from the NPP. are exempt. of certain information acquired as a result of their normal business activities. The Information Privacy Act 2000 (Vic) aims to: ● establish a regime for the responsible collection and handling of personal information.22 Certain acts or practices of members of parliament. The Data-Matching Program (Assistance and Tax) Act 1990 (Cth) provides protection for specific major data matching.PRIVACY AND DATA PROTECTION 225 being excluded from the definition of organisation. It adopts ten Information Privacy Principles which are similar to the NPP set out in the federal Privacy Act. The Act covers the handling of all personal information except health information in the public sector in Victoria. See the Office of the Health Services Commissioner: www.

Public Records Act 2002. State Records Act 1998. and Access to Neighbouring Land Act 2000 (note sections 16 and 26). The scheme requires Queensland Health to comply with the NPP. Other relevant NSW laws include: Health Records and Information Privacy Act 2002. and Police Powers and Responsibilities Act 2000 (Chapter 4 deals with covert evidence-gathering powers). September 2001). New South Wales has also developed statutory guidelines in the form of legally binding documents that define the scope of particular exemptions in the health privacy principles. Criminal Law (Rehabilitation of Offenders) Act 1986 (spent convictions). Freedom of Information Act 1989. 27 See Queensland government website: www. Western Australia The public sector in Western Australia does not have a privacy regime. Freedom of Information Act 1982. Freedom of Information Act 1992.26 The Privacy and Personal Information Protection Act 1998 (NSW) regulates the management of personal information within NSW public sector agencies.226 LAW OF ELECTRONIC COMMERCE Other relevant Victorian laws include: Information Privacy Act 2000. However. Whistleblowers Protection Act 1994. Invasion of Privacy Regulations (1998). . Telecommunications (Interception) (New South Wales) Act 1987. invasion of privacy of the home). Workplace Surveillance Act 2005. 26 See also Health Records and Information Privacy Act 2002 (Cth).au. Health Records Act 2001. Queensland In 2001 the Queensland government implemented a privacy scheme based on the federal IPP. The Queensland Health Rights Commission provides an enquiry service and a health complaint system which covers privacy-related complaints involving the state public health sector. Criminal Records Act 1991 (Spent Convictions). Listening Devices Act 1984. It also sets out the role of the Office of the NSW Commissioner.privacy. Surveillance Devices Act 1999. New South Wales The Privacy Committee Act 1975 (NSW) established the NSW Privacy Committee. and Telecommunications (Interception) (State Provisions) Act 1988. Public Records Act 1973. Invasion of Privacy Act 1971 (listening devices. the Freedom of Information Act 1992 (WA) includes some privacy principles and its confidentiality provisions cover government.27 Other relevant Queensland laws include: State Government Standards Nos 42 (Information Privacy.qld. The scheme applies to state government agencies and corporations.gov. The committee has made significant local progress . September 2001) and 42A (Information Privacy for the Queensland Department of Health.

premcab. The PIPP are based on the federal NPP. and Telecommunications (Interception) Tasmania Act 1999. South Australia South Australia has issued Information Privacy Principle Instructions that government agencies must comply with.PRIVACY AND DATA PROTECTION 227 Other relevant WA laws include: State Records Act 2000. based on the NPP. which is applicable to the SA Department of Health. its funded service providers and others with access to the Department’s personal information. Tasmania In Tasmania the Personal Information and Protection Act 2004 (Tas) implements Personal Information Protection Principles (PIPP) applicable to ‘personal information custodians’ such as public and local government sectors and the University of Tasmania. and Telecommunications (Interception) Act 1988. Northern Territory The Information Commissioner for the Northern Territory is the independent authority responsible for overseeing the freedom of information and privacy provisions of the Information Act 2002 (NT). Surveillance 28 See SA Information Privacy Principles Instruction: www. .sa. State Records Act 1997. record keeping and archive management in the public sector and incorporates freedom of information and privacy principles. The Act is administered by the Department of Justice and complaints may be made to the Tasmanian Ombudsman.gov. and Telecommunications (Interception) Western Australia Act 1996. Criminal Records (Spent Convictions) Act 1992 (NT).28 Other relevant SA laws include: Freedom of Information Act 1991. The Act deals with the protection of personal information.au/pdf/circulars/Privacy. Listening Devices Act 1991. A discussion paper on protecting the privacy of health information in the Territory was issued in March 2002. and includes a code of conduct.au. The Health Information Privacy website provides information and links to health privacyrelated matters in the Territory.29 Other relevant laws include: Information Act 2002 (NT) (privacy. 29 Office of the Information Commissioner Northern Territory: www. FOI and public records). Spent Convictions Act 1988. Annulled Convictions Act 2003 (spent convictions). Listening and Surveillance Devices Act 1972. Surveillance Devices Act 1998.pdf.privacy. Freedom of Information Act 1991. Other relevant Tasmanian laws include: Personal Information Protection Act 2004.nt. Archives Act 1983.gov. South Australia has a Code of Fair Information Practice.

31 While the US Senate considered the nomination of Judge Robert Bork to the Supreme Court. The increase in the amount of data being collected and kept also leads to an increase in mistakes. Telecommunications (Interception) Northern Territory Act 2001 (NT). 215 (DDC January 1998).) . It can only 30 As amended by the Australian Capital Territory Government Service (Consequential Provisions) Act 1994 (Cth).228 LAW OF ELECTRONIC COMMERCE Devices Act 2007 (NT). The cookie can act like an identification card. The Health Records (Privacy and Access) Act 1997 (Health Records Act) covers health records held in the public sector in the ACT and also seeks to apply to acts or practices in the private sector that are not covered by the Privacy Act. It contains privacy principles based on the federal legislation but modified to suit the requirements of health records. (Not to be confused with the infamous criminal Timothy J McVeigh. One such process uses ‘cookies’. AOL agreed to pay damages to McVeigh for having improperly disclosed his identity. Abuses There have already been many early warning signs of the potential for privacy abuse. Supp. is a small text file placed on the user’s hard drive. A brother who had made a few payments of rent for his sister was blacklisted when the sister later defaulted. A cookie. often unknown to the user. Records that show that a particular computer or network was used to access or download ‘undesirable material’ do not identify the actual individual using the facility. in an internet context. by the host of the website visited. Naval officer Timothy R McVeigh was discharged from the US Navy after he came under investigation following details of his use of the internet which revealed the use of the word ‘gay’ on his Internet America Online (AOL) profile. 31 Timothy R McVeigh v William Cohen 983 F. a journalist retrieved and reported the record of the judge’s 146 video rentals as itemised by computer from his local video store. The ACT Community and Health Services Complaints Commissioner handles health record privacy complaints. Cookies Normal use of the internet typically causes information from personal computers to be sent to the hosts of sites visited. Australian Capital Territory The federal Privacy Act30 applies to ACT government agencies and is administered by the federal Privacy Commissioner on behalf of the ACT government. but cannot be executed as code or deliver viruses.

Their purposes may be entirely different: the web host may want information in order to provide a more functional site. Some of these may be advertising banners. Bill Gates. Sharon Nye. city and suburb of the local cinema.35 Web hosts may systematically share information for identification or tracking. However. favourite music is played. The host may register each visit. Gates theorises that life will be transformed by the convergence of inexpensive computing and inexpensive communications. A user in Europe may call up a web page based in Canada. including previous visitors. rooms illuminate to the user’s preset level. Visitors are given electronic tags so that the house computer knows and keeps records of the location of all occupants. and Google. the New York Times.32 The user typically must click through several links and pages. Penguin. Many websites allow the user to set preferences for return visits – Wikipedia has a link ‘My Preferences’ to do this. such a website may allow the user to customise the page so that the web page showing the local cinema appears immediately on access.34 Cookies can be used to identify users and track their movements through the site. London. One web page may include graphics and links from a range of outside sources. they can be placed in a cookie that lets the host take a shortcut to supplying unique information. It may be that both the host in Canada and the advertising owner place cookies on the user’s page.org.greaterunion. A cookie is created and is stored on the user’s computer. where on entering. just the presets. A positive example of a cookie may be accessing a website of a particular cinema chain. Typically. en. Cookies are automatically created by such sites as Wikipedia (the internet encyclopaedia). choosing the state. Indeed the owner of the page may not necessarily know which advertisement will be displayed. . The house computer does not need to know names. He describes the ideal house. www.wikipedia. (2002) PLPR 26. Cookies work in a similar manner to this electronic tag. in his book The Road Ahead. and the advertiser may be collecting information for marketing purposes. Bill Gates.PRIVACY AND DATA PROTECTION 229 be read by the host that presented it to the user. Internet browsers are designed to facilitate cookies. Where the user voluntarily supplies these details. The Road Ahead. 1996. For 32 33 34 35 For example.33 laid out his vision of an interconnected world built around the internet.au. but the advertising banner. the favourite style of art is projected on to the walls and the telephone nearest the user is activated. and the time and number of pages visited within its site. the main purpose of sharing is identification. It is read by the cinema website and automatically responds by customising the information to be displayed. ‘Internet privacy – Regulating cookies and web bugs’. A particular website may comprise several web pages. the temperature is adjusted. The host may also track the visit: this means using cookies to trace usage and status from page to page.com. text and material may be automatically accessed from a location in the United States.

This information can then be shared.37 One view is that a cookie is a unique identifier.230 LAW OF ELECTRONIC COMMERCE example. Any information provided by the user can go to each of these companies. but many last for years. Depending on the information in the cookie. (2004) DTLJ 1. 37 For example. However. two banner advertisements from different companies. Many advertising banners on search engine web pages can record the search engine enquiries. that is used to retrieve your records from their databases. The majority of users are unaware of their existence and of those that do few appreciate the extent of their operation. ‘The spiders stratagem on the Web: Hunting and collecting web users’. with subheadings such as: ‘The pages you read tell marketers what junk to push on you’. when it is provided. As a result of cookie technology. see www.junkbusters. for example. a user can be tracked. .36 A website cannot uncover your email address. There may be. next time you visit a site with that advertiser. Both Netscape and Microsoft Internet Explorer 38 have dedicated directories for this purpose. many sites require an email address as part of their operation. all this raises serious privacy concerns. Cookies operate in a surreptitious manner. when a user visits a particular web page. the cookies verify that the user is the person requesting those items. version 7. In the most usual and typical situation. The default setting for most web browsers is to permit the use of cookies. The cookies make use of the user’s computer without express consent to both write cookies and read them. their operation has been largely clandestine. if not break them. However. and ‘Cookies tell them it’s you every time you click’.com/cookies. a personal banner that reflects your profile may appear. When a user is at the ‘check-out’. from accept all to reject all. Cookies provide significant benefits for users of the internet. the details of all the items can be retrieved using the cookie file. it may be placed or referenced in a cookie. for example. and in certain situations they will stretch privacy rules to the limit.html. With this information the advertising companies may develop a database for future marketing. Cookies are stored on users’ hard drives and may be viewed. each time the basket is filled with items to purchase from separate web pages within a service. where a user accesses an online shopping basket. like a serial number. 38 Microsoft Internet Explorer. The latest version of the browser Microsoft Internet Explorer has six optional settings in relation to cookies. Users must take care with the type 36 See Morris Averill. the web browser usually makes a request for http code to be displayed and for the graphics that appear on the screen. Cookies may have an expiry date. For many people. Each individual cookie may be viewed or deleted. ‘What your browser tells them’. The graphics may come from completely different locations and the user will be unaware of the origin. without its being specifically disclosed.

the type and version of the browser that fetched the web bug image and cookie information related to the website the bug is on. paras 11. the URL of the web page with the web bug.9–11. and they are used to monitor use.41 39 See Australia Law Reform Commission (ALRC).12–11. the URL of the web bug image. In emails. Most privacy laws require disclosure of when information is being collected.39 Web bugs Web bugs are objects embedded in web pages or email. . but invisibility of course assists surreptitious use. the majority of web-based privacy policies do not disclose the use of web bugs.PRIVACY AND DATA PROTECTION 231 of response they make to questions asked of them on websites. (2007) ‘Review of Australian Privacy Law’. not just those with cookies. 41 See ALRC. but web bugs cannot be removed. it will yield the IP address of the computer that fetched the web bug.11. Web bugs may initiate contact with another server. Discussion Paper 72. This is either in ignorance of the applicable law or is deliberate. and when it was read. Anecdotally. the time and date the web bug was viewed. ‘Web bugs and internet advertising’. The image need not be invisible and can be any size. Web bug detectors are freely available. so as not to alert potential users. web bugs may be used nefariously by advertising agencies to gather information for marketing purposes. but this applies to all sites. either disclosure within the email or a link to the privacy policy would be required. This includes information on the personal profile of the users. As with cookies. for example. This can give an indication of the success of. This connects the identity of the user with future access to websites. (2001) PLPR 21. Web bug programmers can synchronise the web bug with a cookie to a particular email address. Originally web bugs were actually tiny invisible or virtually invisible images – one pixel in size – on a computer screen. For email. the IPP and the NPP. The minimum disclosure standard typically requires there to be a privacy policy on the web page’s site. ‘Review of Australian Privacy Law’. and other information. This information may be used in conjunction with cookies to provide statistics. 40 See Kaman Tsoi.40 When a web bug is loaded unknowingly by a user. the IP address of the recipient and how often a message is being forwarded and read. such as the number of visitors to a website. A web bug is sometimes referred to as ‘clear gif’: it is invisible and is usually a ‘gif’ file (image). This is a standard privacy principle and appears in the OECD principles. paras 11. junk email and thus on whether or not the person should be sent future emails. web bugs can be used to determine whether the email was read.13.

2 Everyone has the right to the protection of the law against such interference or attacks. but does not form part of its domestic law. and several pending ratification. No. Article 17 provides: 1 No one shall be subjected to arbitrary or unlawful interference with his privacy. privacy. Many nations have enshrined the right of privacy into their constitutions and laws. to reputation and honour. For example in Griswold v Connecticut43 the state legislature in Connecticut prohibited the use of contraceptives. particularly in relation to healthcare. ‘Data’ refers to electronic symbols typically stored on some form of disk for computers or 42 S Exec. includes the ‘Declaration of the Rights of Man and of the Citizen’. family. 43 381 US 479 (1965). 15 (1992). home or correspondence. . and the confidentiality of communications. The US Supreme Court has used the right to privacy in several decisions since Griswold’s case. in particular the ninth amendment. provides for privacy protection. by a majority of seven to two. Data protection Data privacy (or data protection) are issues in electronic commerce. More than 170 state parties have ratified it.. which is based on the Universal Declaration of Human Rights. The court used the first nine amendments to the Bill of Rights. Everyone has the right to the protection of the law against such interference or attacks. 44 410 US 113 (1973).232 LAW OF ELECTRONIC COMMERCE International Covenant on Civil and Political Rights (ICCPR) The ICCPR. The Constitution of France. in reaching its decision. The Universal Declaration of Human Rights. family. The United Nations has a role to play in enunciating such issues and encouraging adoption and enforcement. in many there is an absence of a controlling and enforceable law to facilitate free expression. home or correspondence. 102-23. The US Senate has declared that acceptance of the ICCPR ‘will not create a private cause of action in US Courts’. in Article 12.42 The treaty binds the United States as a matter of international law. In Roe v Wade44 the Supreme Court stated that a woman’s choice to have an abortion was protected as a private decision between her and her medical practitioner. states: No one shall be subjected to arbitrary interference with his privacy. for instance. However. Rep. nor to attacks upon his honour and reputation. invalidated the law on the grounds that it violated the ‘right to marital privacy’. nor to unlawful attacks on his honour and reputation. The US Supreme Court has stated that the Constitution of the United States includes ‘penumbras’ that guarantee the right to privacy against government intrusion. The US Supreme Court.

The Freedom of Information legislation45 deals with documents. but critical. legislation has focused on the concept of data protection. The UPP.46 The discussion paper was produced following the largest public consultation process in the ALRC’s history: more than 300 submissions were received and 170 meetings were held. 46 Discussion Paper 72. The UPP is designed to minimise costs to businesses by allowing them to retain 45 Freedom of Information Act 1982 (Cth). Standards that reflect cybermanners and protocols should be formulated. Freedom of Information (Scotland) Act 2002. but not the much larger concept of information. There is a view that data has now become so freely available and accessible that privacy has largely disappeared – every individual has some personal data recorded on computer databases. Freedom of Information Act 1991 (SA). The main protection for privacy in the past arose from the sheer costs of retrieving personal information. Some of this data is freely available online. copy and transfer.PRIVACY AND DATA PROTECTION 233 transmitted from computer to computer. themselves a result of the tangible nature of the forms in which that information was stored and the inconvenience experienced in procuring access (assuming that its existence was known). Freedom of Information Act 1989 (NSW). This has led many commentators to consider a review of pre-cyberspace privacy principles. At common law. These practical safeguards for privacy have largely disappeared. data and records. Internationally. This means that the laws protect the data directly rather than the people who are the subject of the data. In 2007 the ALRC released its ‘Review of Australian Privacy Law’ Discussion Paper. set out in full in the discussion paper. 2007. Right to Information Act 2005 (India). Freedom of Information Act 1966 (US) and Privacy Act 1974 (US). Since the OECD Guidelines were released. in a sense. and so has a kind of digital persona. Freedom of Information Act 1992 (Qld). so does the potential for abuse of privacy rights. . Freedom of Information Act 1992 (WA). released data. All nations should examine their laws and policies and adapt them to the new technologies. The ALRC proposes a new set of principles entitled Unified Privacy Principles (UPP). Review As cyberspace and its use continue to grow at an enormous rate. the internet has become such a significant component in privacy issues that a review of the underlying principles would seem to be not just be prudent. Freedom of Information Act 1982 (Vic). Freedom of Information Act 1991 (Tas). Freedom of Information Act 2000 (UK) . making it now relatively easy to locate. the tort of passing off and the principles relating to confidentiality and trade secrets provide indirect protection. uses the NPP as a template. Internet standards and the initiatives of bodies such as the Global Internet Liberty Campaign have assisted in some nations in doing this. Official Information Act 1982 (NZ). The technology has. Privacy was further protected by the incompatibility of collections with available indexes and the difficulty in ascertaining the existence of most personal data. Freedom of Information Act 1989 (ACT).

However. The ALRC is further proposing that the Australian Privacy Commissioner be able to issue website operators with take-down notices for inappropriate information placed online: information that may constitute an invasion of an individual’s privacy.49 He has also reflected on his role as the Chair of the OECD Expert Group on the Protection of Privacy. this may involve complex issues of law. there will be little which they can do to influence the information flow except to enact laws enforceable in their courts in the comparatively rare instances in which they can catch those who offend against such laws within their jurisdiction. Many cyberspace individuals have developed digital personas. they were ineffective for the internet. 49 M Kirby. often with complex and detailed identities. Rosemary West was accused of involvement in notorious serial killings. (1999) 30(2) Library Automated System Exchange. target or affect an individual. former Justice of the High Court of Australia and one-time Chairman of the OECD Expert Group on the Protection of Privacy (1978–80) and on Security of Information Systems (1991–92). . President of the International Commission of Jurists. the discussion paper does not specify a trigger or standard on the basis of which the Privacy Commissioner could make such a determination. children. ‘Privacy in a brave new world: ALRC proposals for privacy and technology’. for example. .47 The ‘Review of Australian Privacy Law’ provides a detailed basis for discussion by legislators. The force of the technology (and the vast audiences which it gathers up) suggest that common global standards will tend to swamp local susceptibilities. In most countries. in a truly effective way. (2007) Privacy Law Bulletin 61 and Alan Davidson. 48 The Hon Justice Michael Kirby AC CMG. . and demonstrates many deficiencies of legislation in the face of galloping advances in technology. ‘International dimensions of cyberspace law: Protection of privacy and human rights in the digital age’. Governments and legislatures are not wholly powerless . biometric information. young people and the internet. The ALRC acknowledges the need to co-ordinate and unify the IPP and NPP. (2008) Internet Law Bulletin 21. ‘Privacy reforms: Technological considerations in the age of the internet’. Unfortunately. In the 1990s in the United Kingdom. Such a determination must balance freedom of speech and freedom of expression issues and lawful behaviour. developing technology. The ALRC Discussion Paper also considers expanding the meaning of ‘identifiers’ as used in NPP 7. The ALRC proposes changes to the definition of ‘personal information’ and ‘record’ so that they would include email addresses and IP addresses where these can be used to contact. local norms and values affecting global information . State Library of New South Wales. .234 LAW OF ELECTRONIC COMMERCE policies and processes they have already implemented. . As Michael Kirby 48 wrote: The case illustrated the effective powerlessness of most national courts to enforce. noting that the OECD Guidelines have become largely obsolete and raising the following potential rights: ● a right not to be indexed – if a ‘rogue’ robot indexer ignores existing or new contemporary standards which exclude indexing. 12. 47 See Alan Davidson. Efforts to control traditional media outlets were well established and effective. spam and telemarketing.

of disclosure of the collections to which others will have access and which might affect the projection of the profile of the individual concerned. The second and third suggestions relate to the use of high-level encryption systems for protecting private information. They did not have the permission of the racetrack authorities. and a right. Kirby suggests that this request should be elevated to a right. in Victoria Park Racing v Taylor. the argument remains that lawful use of such privacy protection should be a right. a right to fair treatment in public key infrastructures. In 1937. 51 Ibid. However. This may take the form of surveillance cameras. Personal privacy Personal privacy involves what could be described as ‘invasion of the person’. ‘Privacy in cyberspace’.52 the High Court of Australia determined.PRIVACY AND DATA PROTECTION ● ● 235 ● ● a right to encrypt personal communications effectively. some governments have made attempts to circumvent or restrict public key cryptography.50 All data collection practices. When in place it signals to search engines a request to ignore the website and not to index it.51 Kirby’s first suggestion deals with the process by which internet search engines search for websites and index them for all to see. the right to such privacy has been eroded by legislation such as the PATRIOT Act of the United States. In the post-September 11 era. The case was about a prominent Sydney radio station setting up a platform adjacent to a horseracing track for the purpose of calling the races live on the radio. Nevertheless. as well as by public opinion (to some degree). Kirby claims. must be open and transparent to individuals prior to operation and permit the individual the ability to disengage the feature if desired. that there was no right to privacy at common law. going beyond the aspiration of the OECD openness principle. . in a majority verdict. and the media following people. stalking. hypertext transfer protocol (http). 50 Kirby. Many websites are intended for private or limited use. Public key cryptography currently provides the best protection. so that no person is unfairly excluded in a way that would prejudice that person’s ability to protect their privacy. a right to human checking of adverse automated decisions and a right to understand such decisions. The underlying code in websites. includes a ‘no robot’ code as an option for such index systems to take note of. The High Court ruled that the racetrack authorities could not prevent a party viewing or broadcasting from an adjacent private property. Yet many search engines cannot discriminate. such as politicians and celebrities. 52 (1937) 58 CLR 479.

58 Such phenomena have produced applications to the courts for relief.53 In particular. para 316. para 335. surreptitious surveillance. as they emerge. and developments of the law in other common law jurisdictions. Any consideration of that matter should be undertaken with regard to the separation of the roles of the judiciary and the legislature . The ABC intended to broadcast excerpts on a television current affairs program in Tasmania.236 LAW OF ELECTRONIC COMMERCE Whether or not Australian law recognises a tort of invasion of privacy was raised in the High Court case Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd. Gummow and Hayne JJ referred to the case of Church of Scientology v Woodward. the time is ripe for consideration whether a tort of invasion of privacy should be recognised in this country. gross invasions of personal privacy. having regard to current conditions in this country. Callinan J gave tentative approval for such a development in several paragraphs of his judgment. para 172. . 133 NE 437 at 437 (NY 1921). [2001] HCA 63. or whether the legislatures should be left to determine whether provisions for a remedy for it should be made. ‘[t]he cry of distress is the summons to relief ’.59 In Australia.56 in which Murphy J identified ‘unjustified invasion of privacy’ as one of the ‘developing torts’.57 Kirby J stated that ‘cheque-book journalism’. para 172. or their value becomes evident. but the observations and statements made in obiter revived the issue of a possible tort of invasion of privacy to the person. He did so first by arguing for a property right in a spectacle: It may be that the time is approaching. generally. indeed it may already have arrived. 55 The High Court’s decision in Lenah Game Meats was based on the law of trespass. [1982] HCA 78. deliberately deceptive ‘stings’ and trespass onto land ‘with cameras rolling’ are mainly phenomena of recent times. [2001] HCA 63. The facts were that unidentified trespassers gained access to the abattoirs and filmed the slaughtering and processing of possum meat for the export market. the question was whether or not such a right might attach to a corporation.60 53 54 55 56 57 58 59 60 [2001] HCA 63. Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd [2001] HCA 63. recognise new forms of property. para 13. Most of the High Court held that whether or not a tort of ‘invasion of privacy’ might develop under Australian law was still an open issue. Wagner v International Ry Co. ‘courts exercising equitable jurisdiction have upheld the entitlement to relief where to turn their backs would be seriously offensive to conscience’.54 His Honour went on: It seems to me that. [2001] HCA 63. including injunctive relief. There is no reason why the law[s] should not. . Adapting the words of Cardozo J used in another context. for the recognition of a form of property in a spectacle. . intrusive telephoto lenses. [1982] HCA 78.

(b) which intrudes upon the privacy or seclusion of the plaintiff. unlawful entry to her home. spying.PRIVACY AND DATA PROTECTION 237 While the Supreme Court of New South Wales. which causes the plaintiff detriment in the form of mental psychological or emotional harm or distress or which prevents or hinders the plaintiff from doing an act which she is lawfully entitled to do. Giller v Procipets [2004] VSC 113. . both the District Court of New South Wales63 and the County Court of Victoria64 have availed themselves of opportunities to develop the principles of invasion of personal privacy. Despite a court order. repetitious phone calls and use of offensive language and behaviour towards the plaintiff over an extended period of time. Skoien SDCJ stated: It is not my task nor my intent to state the limits of the cause of action nor any special defences other than [are] necessary for the purposes of this case. her Honour held that it was wrong to publish this personal information where 61 62 63 64 65 66 67 NRMA v John Fairfax [2002] NSWSC 563. unwelcomed physical contact. [and] (d) . who was the husband of the victim.66 In Jane Doe v Australian Broadcasting Commission.61 Supreme Court of Victoria62 and the Federal Court of Australia have questioned this development. a prominent Queensland political figure. sued the defendant for. The plaintiff. In Grosse v Purvis65 the District Court of Queensland recognised a separate common law cause of action for invasion of privacy. the ABC broadcast in its news bulletins the name of the rapist. As a result of the defendant’s stalking behaviour. [2007] VCC 281. The plaintiff was successful and was awarded $178 000 in compensatory.67 Hampel J of the Victorian County Court awarded a rape victim $234 190 in damages based in part on invasion of her privacy. the plaintiff suffered posttraumatic stress disorder (PTSD). amongst other things. The conduct of the defendant included instances of loitering. Grosse v Purvis [2003] QDC 151. Ms Grosse. In my view the essential elements would be: (a) a willed act by the defendant. the name of the victim and her suburb. para 444. . including in her elected position. Jane Doe v ABC [2007] VCC 281. The plaintiff ’s condition was held to seriously and adversely affect her enjoyment of life and ability to function. damages for invasion of privacy. [2003] QDC 151 [2003] QDC 151. Without formulating an exhaustive definition. The judge was satisfied on the evidence that the defendant developed an extraordinary and active infatuation with the plaintiff. aggravated and exemplary damages – for invasion of privacy and other causes of action. (c) in a manner which would be considered highly offensive to a reasonable person of ordinary sensibilities. .

The areas in which employees have the greatest sensitivity in relation to the use of video surveillance are toilets. . The cost of surveillance equipment has reduced dramatically. but also an obligation to protect employees and the company from unlawful activities. such as dining. showers and areas where employees may change clothing. but also in employee-only areas. More employers are using surveillance cameras and connecting them to the internet for remote surveillance. where there are high levels of monitoring of employees. hotels and malls surveillance cameras record our movements. Cameras are being placed not only in places the public may frequent. The employer has the right to manage the workplace. The employers’ concerns may also relate to areas with expensive furnishings or recreational equipment and other ‘vulnerable’ assets (such as vending machines). Surveillance cameras have become a part of modern life. The community as a whole has come to accept the underlying rationale: the need to protect personal safety and to reduce theft. employees also express concern about surveillance in areas set aside for employees when they not engaged in actual employment. which was designed to restrict and regulate the use of video surveillance equipment in the workplace. recreational areas. Employers must consider these effects of surveillance on productivity. . Under the 2005 Act. anxiety and lower productivity levels. and also personal behaviour such as flirting and other general behaviour where there is an assumption of privacy. One US advocate has documented police parties where ‘best of ’ videos are shown. and are used for a variety of purposes: there are now more than 40 million cameras linked online. making increased digital scrutiny within the reach of nearly all businesses. Walls of TV screens allow authorities in the control rooms in major cities to monitor major roads. In call centres. They are largely taken for granted. practising regular religious observances. supermarkets. It is clear that employers have a legitimate interest in placing cameras in positions frequented by members of the public. this has the secondary effect of keeping an eye on employees. However. the NSW government introduced the Workplace Video Surveillance Act 1998 (now replaced by the Workplace Surveillance Act 2005).238 LAW OF ELECTRONIC COMMERCE there was no corresponding public interest and where there was a prohibition on publishing. In an effort to address these competing interests. In petrol stations. . Internet cameras are commonplace. Some link the cameras to the internet for remote surveillance. However. Concerned parents have set up cameras which record actions by their babysitters. a court may order surveillance only where ‘reasonable grounds exist to justify its issue . tension. [having] regard to the seriousness of the unlawful activity with which the application is concerned’68 and only under the following conditions: 68 Workplace Surveillance Act 2005 (NSW) s25. studies have shown that workers experience greater health problems such as depression. Misuse is not unknown.

Jeff Shaw. It is advisable for employers to disclose the use of surveillance cameras. allegedly because he suspected employees were using drugs in the toilet. and (c) when the surveillance will start. New employees have the ‘choice’ of refusing employment under such conditions. and (e) whether the surveillance will be for a specified limited period or ongoing. findlawaustralia. Commissioner Larkin considered videotape of an employee removing a bag of coins from a weighing scale and placing the bag between the scales and her till. Y Liu v Star City Pty Limited PR903625 [2001] AIRC 394. there are provisions which relate to general surveillance activities by ‘authorities’. and (d) whether the surveillance will be continuous or intermittent. Indeed. ACI claimed that it was installed in a first-aid room to monitor oxygen tanks. which provide some protection. if its purpose is to deter thieving. The room was frequently used by employees to change their clothing as well as to receive treatment for ailments.71 The commissioner expressed concern that the applicant did not have access to the surveillance videotape and had not been shown the videotape at any point during the investigation.70 In the recent unfair dismissal case in the Australian Industrial Relations Commission. . ‘Surveillance in the work place’. When the 1998 Act came into effect. and (b) how the surveillance will be carried out. the videotape is clear on its face. Disclosure in the contract of employment clarifies the position for all parties. However. However. . stating: ‘I am not satisfied that the applicant made an honest mistake on the night in question. a box of videotapes with the ratings ‘best’. one may argue that the surveillance. Belinda Harding. In my view. unjust or unreasonable.’72 The commissioner ruled that the termination was not harsh.69 The two Acts prohibit ‘covert’ surveillance unless an ‘authority’ has been issued by a magistrate. Y Liu v Star City Pty Limited PR903625 [2001] AIRC 394.com. ‘beauty’ and ‘great’ was found. the then Attorney-General and Minister for Industrial Relations. A Sydney lawyer breached the Act when he installed secret cameras in the female toilets of his law firm. The employer needs to decide whether the priority is to prevent theft or to catch a thief. stated: ‘the secret filming of workers in the workplace will be illegal unless there are reasonable grounds to suspect an employee is committing an unlawful act and a court authority is obtained’. which had been stolen in the past. is ineffective unless its use is known. imposing conditions on existing employees may prove problematic. In July 2003 ACI Glass Packaging was fined $500 under the 1998 NSW Act for installing a secret camera in a room where employees undressed. There is still no specific legislation dealing with workplace surveillance in other Australian states. computer or tracking). 69 70 71 72 Workplace Surveillance Act 2005 (NSW) s10. para 30.PRIVACY AND DATA PROTECTION 239 The notice must be given at least 14 days before the surveillance commences [and] .au/articles/. the commissioner still accepted the surveillance. However. . must indicate: (a) the kind of surveillance to be carried out (camera. However.

75 Reasonable use surveillance would be unlikely to be regarded as an invasion of privacy. the website of the NZ Privacy Commissioner: www. New Zealand The Privacy Act 1993 (NZ) came into effect on 1 July 1993. the New Zealand Privacy Act gives the Privacy Commissioner the power to issue codes of practice that become part of the law.76 73 [2003] QDC 151 (based on the High Court Justices comments in ABC v Lenah Game Meats (2001) HCA 63). The YMCA and the Royal Life Saving Society of Australia have banned camera phones because of their concerns about inappropriate pictures being taken surreptitiously. The policy would presumably note that public areas are subject to surveillance and that personal areas such as toilets and changing areas are not. holding.74 The elements of the cause of action proposed for personal privacy are most appropriate for camera surveillance situations. its release in the event of a complaint or other action would demonstrate a considered and judicious approach to the predicament. para 444. Even if the policy is not initially disclosed to the employees. The Privacy Act 1993 makes use of the 1980 OECD Guidelines on the Protection of Privacy and Transborder Flows of Personal Data as its template. Its underlying aim is the promotion and protection of individual privacy. As for the middle ground.240 LAW OF ELECTRONIC COMMERCE Formulating a policy may prove useful. use and disclosure of personal information and assigning unique identifiers. generally. The Act contains 12 IPP. Decision . a more circumspect policy may state that surveillance will only be undertaken if a legitimate concern regarding an employee’s actions has arisen. Like the Australian Act. It followed the Privacy Commissioner Act 1991 (NZ) which had established the office of Privacy Commissioner. dealing with collecting. 75 [2003] QDC 151. para 442. ‘there can be a civil action for damages based on the actionable right of an individual person to privacy’. clearly the bather’s privacy has been violated. However. If someone photographs a bather in a change room and posts the image on the internet. misuse. 76 See. In Grosse v Purvis73 Senior Judge Skoien stated.privacy. Cell phone cameras provide a clandestine method for taking photographs and videos. In certain circumstances the Privacy Commissioner may authorise agencies to collect. The privacy principles give individuals the right to access personal information and to request correction of it.org.nz/. 74 [2003] QDC 151. For a judicial consideration of the Privacy Act 1993 (NZ) see Harris v Selectrix Appliances (Complaints Review Tribunal. Generally the Act applies to both the public and private sectors. such as for voyeurism or to eavesdrop for negotiation purposes may cross the line. use or disclose information even though that would otherwise breach information privacy principles.

and oversight of matching programs through the establishment of Data Integrity Boards at each agency engaging in matching to monitor the agency’s matching activity. 2001). They include for statistical purposes by the Census Bureau and the Bureau of Labor Statistics. and to allow the individual to request amendments of their record. 15/2001. The Act significantly expands the authority of US law enforcement agencies for the purpose of fighting terrorism. except pursuant to a written request by. 78 See also the US Computer Matching and Privacy Protection Act. Decision No. The full name of the USA PATRIOT Act is the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act 2001. 2001). Commissioner of Inland Revenue v B [2001] 2 NZLR 566. written. or to another agency. law enforcement purposes.PRIVACY AND DATA PROTECTION 241 United States In the United States. archival purposes. L v L (Complaints Review Tribunal. email and financial records without a court order. The US Computer Matching and Privacy Protection Act 1988 amended the Privacy Act to include protections for the subjects of Privacy Act records whose records are used in automated matching programs. also known as the USA PATRIOT Act. These protections are designed to ensure procedural uniformity in carrying out matching programs. At a time when the right to privacy was solidifying in the No. The US Privacy Act 1974 was passed during the administration of President Nixon. the right of freedom of speech granted in the First Amendment has limited the effects of lawsuits for breach of privacy. 77 Privacy Act 1974. 2001 and was conceived. It affects their privacy by arming authorities with a range of investigative rights to access and gather information about communications. It has many provisions that affect the lives of Americans in America. health and finances. The Act provides: no agency shall disclose any record which is contained in a system of records by any means of communication to any person. Every US federal government agency must put in place an administrative and physical security system to prevent the unauthorised release of personal records. due process.79 This Act was in response to the attacks of September 11. ‘National Security Letters’ allow the Federal Bureau of Investigation to search telephone.77 There are a number of specific exceptions. the individual to whom the record pertains. or with the prior written consent of. The Act permits ‘sneak and peek’ searches where law enforcement officers may search a home or business without the owner’s or the occupant’s permission or knowledge. debated and passed within 45 days. 5 USC § 552a. .78 All government agencies are required to maintain a system permitting access upon request by any individual to permit the review and copying of the record. 12/2001. congressional investigations and other administrative purposes. 79 (Public Law 107-56).

Final comment Law makers and business need to monitor the changing national and international legal environments to ensure that the risk of privacy breaches in the future is minimised. The legal protection of databases. Further reading Australia Law Reform Commission (ALRC). practice. Its expansion should reflect global values and human diversity. (2008) Internet Law Bulletin 21. Cambridge. ‘Internet privacy – Regulating cookies and web bugs’. Regulations in cyberspace must evolve in a way that includes fundamental human rights and national governance. and reflects global values and human diversity. (2002) PLPR 26. (2007) Privacy Law Bulletin 61. Discussion Paper 72. Sharon Nye. Alan Davidson. 2007. this Act single-handedly sets back information privacy rights by decades. ‘Privacy reforms: Technological considerations in the age of the internet’. Mark Davison. procedure and presence in cyberspace. . ‘Review of Australian Privacy Law’. Alan Davidson. Cambridge University Press. 2003. The internet should develop in a way that demonstrates respect for fundamental and universal human rights and democratic governance. The rule of cyberspace encompasses law. ‘Privacy in a brave new world: ALRC proposals for privacy and technology’.242 LAW OF ELECTRONIC COMMERCE US courts and Congress.

word-processed document files. users will have the advantage of digitally saving conversations in a similar way to the way in which they can already save email messages. more powerful and easier to use. Email messages can be accessed on the screens of the newer models of mobile phone. more usually. This chapter deals with legal and practical issues relating to the use of electronic mail and maintaining an online presence. Email adds a further dimension to communication. telexes and facsimile. Email will be required by many government departments and courts for the lodging of materials and to facilitate correspondence. It allows users to send messages created on the computer to any other internet computer in a matter of seconds. Data files such as photographs.14 Electronic mail and online presence The availability of electronic mail (email) goes beyond the introduction of postal systems. sound clips and. 243 . the telephone. In fact any file which may be stored digitally may be transferred by email. Additionally. It is usually cheaper and quicker than a telex or facsimile and more reliable than the ordinary post. The tools to access and navigate between systems are steadily becoming cheaper. can be attached to an email message. In the near future verbal communication will take place with greater ease and clarity than the telephone. Email is becoming integrated with other communication technologies such as facsimiles. study and recreation in a manner previously unimaginable. Email is a fast and efficient worldwide communication portal. Email Email is one of the most popular applications of the internet. The internet provides tools to maximise the use of time to engage in discourse. pagers and personal digital assistants (PDAs).

emails are generally text. Several companies have produced software applications: these aim to maximise ease of use and offer attractive features such as folders for filing mail. now almost before living memory. each computer and each internet page is unique. no two email addresses may be the same. 1 See Chapter 17. Users can have more than one email program on their computer. or in the attachment itself. checks on delivery and receipt of mail sent. and new messages to be created. Attachments In common with normal mail.244 LAW OF ELECTRONIC COMMERCE The internet’s use as a recreational facility and business tool is relatively new. Depending upon the intention of the sender. Many individuals possess several unique email addresses. . Australian Evidence Acts do not address all aspects of email communication. Unlike names. SMTP is activated when mail is sent. addressed envelope and drops it in a letter box. they do not have to understand the processes conducted by the mail carrier to know that the letter will be delivered. the address for each person. much like an envelope. The interface with the internet mail protocol allows incoming messages to be read. Sections 160–2 of the Evidence Acts of the Commonwealth. It may also be the intention of the sender that the attachment be printed and the printout be the original document. deleted or saved. typically using standard protocol (ASCII or HTML files). plans. When a person writes a standard letter. preparation of group lists. the facsimile and the photocopier were introduced to offices.1 Authentication Authentication of electronic messages will become increasingly important for evidentiary purposes. Depending upon the requirements of the sender. puts it in a stamped. In cyberspace. or that the protocol used on the internet to standardise the transfer of mail is called SMTP (Simple Mail Transfer Protocol). had a significant effect on business and communication. The integration of the telephone into the office. it is usually possible to attach data files to email. In this manner the email itself is regarded as a courier. encryption for security. feature buttons. Users do not need to understand that the email facility creates text. Many can recall similar effects when the telex. for transmission. Email is the same. Although it is impossible to email hard copies of photographs. documents for signature and so forth. forwarding on to others and so forth. the attachment is an electronic record. proof of which may be determined by inherent meta-data. it is prudent to make an express statement of this intention either within the accompanying email.

was expanded to apply to electronic communications – this includes all modern electronic technologies as well as more outmoded ones such as facsimile and telex. states and territories were enacted to facilitate admission of electronic communications where they are functionally equivalent to traditional paper-based communications. Irony and sarcasm do not translate well on email.2 Courts increasingly need to be satisfied regarding the authenticity of transmissions. it is important to be aware of the context and to consider how the written communication will appear if read by other parties. they do provide that: The hearsay rule does not apply to a representation contained in a document recording a message that has been transmitted by electronic mail or by a fax. However. lettergrams and telegrams. Some people take care by writing the obvious ‘(just kidding)’. The exception to the hearsay rule in section 71 was similarly expanded. lettergram or telex so far as the representation is a representation as to: (a) the identity of the person from whom or on whose behalf the message was sent. The parties may soon be involved in a conversation that involves an exchange of a dozen or so emails within a single hour. syntax and an appreciation of the form of the medium involve customs which many of us take for granted. The use of language without careful and appropriate consideration may have unintended and potentially disastrous consequences. including a court. dealing with the facilitation of proof. Grammar. or on any form of written communications. telegram. email can be handled with such relative ease and speed that communications tend to become less formal. However. Recently section 161. The Electronic Transactions Acts in the Commonwealth.-( In any event. telexes. 3 See Chapter 3 and Chapter 17. or (c) the message’s destination or the identity of the person to whom the message was addressed. perhaps more akin to speaking in person or on the telephone.ELECTRONIC MAIL AND ONLINE PRESENCE 245 New South Wales. There is no similar presumption regarding email.) Smiley is used to communicate subtle nuances which may otherwise be absent. The chance increases for informal and glib comments. Others use smiling faces :-) or . The use of Smiley has led others to use the unhappy face to express displeasure: :-( or .3 Language Several texts that discuss electronic communications emphasise the need to keep language formal.-) (Turn your head sideways to the left. . 2 See Evidence Amendment Act 2008 (Cth). Tasmania and the ACT make presumptions regarding the sending and receipt for postal articles. or (b) the date on which or the time at which the message was sent. when writing.

Several of these rumours have been hoaxes. whether or not it is contractual) and how prior disagreements were resolved. Second. Another could be the fact that Norwich Union paid out £450 000 to a competitor. courts will look to the surrounding circumstances. However. First. plus viruses. This may include such factors as prior communications. however. and they may not have as good a system of checks and balances as they have with standard mail. the nature of the relationship (for example. unintended contract formation.246 LAW OF ELECTRONIC COMMERCE Viruses Many myths and rumours have been circulated regarding the dangers of catching a computer virus from email. Defamation. Western Provident. The value of disclaimers. The reality is that a virus cannot be contracted by simply opening an email message. for defamatory emails circulated by an employee. legal privilege. infringement of copyright. misdirected emails. A person contemplating legal action may think twice if an appropriately worded disclaimer was included 4 Hedley Byrne v Heller [1964] AC 465 is a precedent on negligent misstatement. the judgment on that issue is strictly obiter as the defendant succeeded because of the inclusion of an effective disclaimer. As a general rule. or sources which are regarded are secure. the courts will typically attach more weight to the substantive content of the email. the disclaimer may ward off legal action. users should only open attachments from persons they know. High numbers of mail defamation incidents. . unintended contract formations and misdirected emails demonstrate the lack of appeal of email disclaimers. There are occasions where a standard disclaimer is clearly inappropriate in relation to the actual content of the email. However. They reply and send without taking sufficient time to reflect. One is that the nature of email means that writers are often less formal and more unguarded than they would be with hardcopy mail. Importantly. Disclaimers Disclaimers often appear at the end of emails. all-purpose disclaimer but does not address the reasons for its inclusion in the email in question. sexual and racial discrimination and harassment are just a few issues of concern addressed in disclaimers. confidentiality. This occurs where the sender includes a standard. is well known. The reasons suggested for this vary. However.4 Disclaimers are much more routinely included in emails than in standard mail. Most users have a rudimentary understanding as to how data is transmitted by email and how it is read. interpreted and converted into meaningful text and files. Many have nonetheless decided to err on the side of caution. particularly unsolicited email. they can be transmitted by attachments. the value of these disclaimers is questionable. Many are ignored by recipients.

Prepending such notices (putting them at the start of a message) rather than appending them (at the end) may be useful. for example. but they may discourage disgruntled recipients from initiating a dispute. adding a disclaimer may be a useful negotiation tactic in appropriate circumstances. The writer should consider the purpose for which the email is sent and which areas require protection. Viruses Many email writers include a disclaimer that they take no responsibility for checking for viruses: that responsibility falls on the recipient. Where it is not made in the ordinary course of business the disclaimer would not be needed. A disclaimer will most likely not excuse the act where it is made in the ordinary course of business. the company will be liable for the effect of the advice that the recipient. A suitably worded disclaimer could protect the sender and the sender’s organisation from this kind of liability. Nevertheless. the disclaimer may resolve internal responsibilities and liabilities between employee and employer. However. a person is obliged to take care when giving advice that a third party relies on. Defamation Employers have been held liable for defamatory statements made in emails by employees. if in doubt.ELECTRONIC MAIL AND ONLINE PRESENCE 247 in the transmission. there is a variety of concerns regarding legal liability: contractual or defamatory concerns. The disclaimer may provide a useful argument in negotiations to resolve a dispute early and for a lower sum. Confidentiality An express statement that a communication is confidential may well make the difference between its being treated as confidential or not. reasonably relies upon. If an employee were to give professional advice in an email. a disclaimer should be included. It could be argued that the notice may be ineffectual if it is in small print or placed after the sign-off at the end of the message. Whether these disclaimers would be effective in court is questionable. There is a vast difference. In a commercial context. between commercial and personal emails. Negligent misstatement By law. Copyright A disclaimer would be unlikely to serve as a defence to a charge of breach of copyright. even though one of the greatest problems with disclaimers is the use of inappropriate ones. . concerns regarding confidentiality and regarding accidental delivery to the wrong address. or even a third party. Additionally. Generally. an appropriately worded disclaimer may indicate the level of care taken and the intention behind the transmission.

thought and consideration before replying. issued. and how much time is allowed or available for reflection. Many employers may be surprised and disturbed at the use and misuse of email by employees. The company should establish procedures to guard against such situations. Once a risk analysis has been completed. A disclaimer on internal emails may put all parties on notice about the employer’s policy and concerns. to a specified email address. Risk assessment Each organisation and individual should consider undertaking a risk audit on its email procedures and policies. marked for the attention of the defendant. used and served in electronic form. filed. how often emails are sent. Such a disclaimer may state: ‘No employee or agent is authorised to conclude any binding agreement on behalf of this firm/company without the express written confirmation by a partner/director of the firm/company. The summons first came before B M James J. from publishing certain material on the internet. and by sending copies of the documents. Since that case New South Wales has amended its Electronic Transactions Act 2000 by inserting Part 2A Court Administration. Liability will depend upon whether the act was or was not in the course of business. 1. This Part established an Electronic Case Management (ECM) system to enable documents with respect to legal proceedings to be created. Service of documents by email In the NSW Supreme Court case of Macquarie Bank v Berg5 the plaintiff sought an order restraining the defendant. the nature of email is that an immediate reply is more likely. section 14M provides that any document filed in or issued by 5 [1999] NSWSC 526. . their authority. The audit should determine who sends emails. Berg. However. who abridged the time for service and directed that service be effected by delivering a copy of the documentation on the solicitors acting for the defendant in other proceedings between the parties. and on factors such as the level of supervision and position and authority of the offending employee.248 LAW OF ELECTRONIC COMMERCE Accidental contract formation A disclaimer could clearly set out the extent to which personnel have actual authority to bind the company or employer. the organisation is in a much better position to prepare a policy or code of conduct and to determine the extent to which disclaimers ought to be used in their email system. Employees should be informed of the employer’s policy and expected practice. For example.’ Sexual and racial discrimination and harassment Internal emails may give rise to claims of discrimination or harassment. whether there is a supervisory process or checking process.

but it cannot be determined which has a closer relationship to the underlying transaction. prior email use. Time and place of dispatch and receipt All nine jurisdictions in Australia have enacted an Electronic Transactions Act that includes a provision regarding the time and place of dispatch and receipt of electronic communications. the time of receipt is the time when the electronic communication enters that information system. such as a letterhead or a business card. NT – s13. SA – s13. If the sender or recipient does not have a place of business.ELECTRONIC MAIL AND ONLINE PRESENCE 249 an ECM court by means of the ECM system may be served electronically. Vic – s12. The designation of an information system may be by prior conduct. Other states and territories have made similar provisions in their equivalent statutes and regulations. the dispatch occurs when it enters that information system. 8 Ibid. Tas – s11. the time of receipt is the time when the electronic communication comes to the attention of the addressee.10 6 The provisions were examined in detail in Chapter 3. If the sender or recipient has more than one place of business. it is to be assumed that that place of business is only place of business. 10 Ibid. unless otherwise agreed. If the recipient has not designated such an information system then. .7 Time of dispatch If an electronic communication enters a single information system outside the control of the sender. 9 Ibid. SMS and instant messaging. 7 Electronic Transactions Acts – NSW s12.9 Place of dispatch and receipt Unless otherwise agreed. facsimiles. the electronic communication is taken to have been dispatched at the place where the sender has its place of business. Cth – s14. If the sender or recipient has more than one place of business. unless otherwise agreed. and one of those places has a closer relationship to the underlying transaction. unless otherwise agreed. then. or by including the email address in correspondence. ACT – s13.8 Time of receipt If the recipient of an electronic communication has designated an information system for the purpose of receiving electronic communications. then it is assumed that the principal place of business is the only place of business. Qld – s23. it is assumed that the place of business is the place where the sender or recipient ordinarily resides.6 Electronic communication includes emails. WA – s13. then. and is taken to have been received at the place where the recipient has its place of business.

structure. many just in order to have simpler and speedier communication. The pages may be updated at any time. the pages can act as an online storefront. That is. graphics and links. programming. ● maintenance and future amendments. There are many fly-by-night operators arising as demand has grown. Alternatively. including rights between the head contractor and the subcontractors.250 LAW OF ELECTRONIC COMMERCE Web page presence All forms of business have taken hold of internet technology. graphics. Others have created web pages. Some use the pages in a simple static way. For a modest fee. the user may have allocated internet space to place a number of web pages with text. ● the degree of subcontracting. Liability for online material Misleading and deceptive conduct Online businesses are liable for material and information that is misleading and deceptive within the meaning of laws such as the Trade Practices Act 1974 (Cth) and the Fair Trading Acts of the states and territories. the business may produce dynamic web pages. A contract with a web designer should include provisions dealing with: ● intellectual property aspects of the content. However. As most hosts lack the expertise to develop professional web pages. The nature of a web page is that it is . These are pages where potential consumers may interact with the host by placing orders and making enquiries. they provide a simple electronic brochure. This form of advertising is cheap and continuous. ● indemnities. often included in the price of connection. ● the product delivered – this aspect should include details of not only content but also compatibility. there are many legal concerns as well. domain names and computer and web code. such as the placement of key terms in the web pages and in meta tags (HTML searched and indexed by the search engines – called Search Engine Optimisation). Many of these are small businesses juggling the joint considerations of design. and functionality and performance criteria. implementation. and the brochure is available to all 24 hours a day. ● marketing strategy – such as the steps to be taken to actively place the pages on the most appropriate search engines and the strategy for indexing by search engines. they generally seek the services of a web developer. multimedia artwork and graphics. These laws apply to statements and representations made in web pages just as they apply to hardcopy advertisements and brochures. Some issues faced by the host in the design of the website are technical and practical.

12 Defamation Statements made online – by web pages or email – are of course subject to defamation laws. .cnn. (e) make a false or misleading representation with respect to the price of goods or services. This led to the dismissal of some employees for engaging in inappropriate email messaging: www. (c) represent that goods or services have sponsorship. accessories. exclusion or effect of any condition. in 2000 the Dow Chemical Co. uses or benefits they do not have. (b) falsely represent that goods are new. value or grade. composition.11 Steps should be taken to ensure that information remains current. Substantially similar provisions appear in the Fair Trading Acts of the states and territories. some sites require the user to click a button titled ‘I agree’ which follows ‘terms and conditions of use’.idg/index. in connexion with the supply or possible supply of goods or services or in connexion with the promotion by any means of the supply or use of goods or services: (a) falsely represent that goods are of a particular standard. performance characteristics. 12 Trade Practices Act 1974 (Cth).firing. warranty. (bb) falsely represent that a particular person has agreed to acquire goods or services. (d) represent that the corporation has a sponsorship. audited their employees’ usage. (ea) make a false or misleading representation concerning the availability of facilities for the repair of goods or of spare parts for goods. in trade or commerce.com/2000/ TECH/computing/09/19/dow. Section 53 False or misleading representations A corporation shall not. value. accurate and correct. and the criminal provisions of section 53: Section 52(1) A corporation shall not. style or model or have had a particular history or particular previous use. quality. web pages often have a greater potential for being viewed. quality. In particular. in trade or commerce. note the application of Trade Practices Act 1974 (Cth) (TPA) section 52. engage in conduct that is misleading or deceptive or is likely to mislead or deceive. approval. (f) make a false or misleading representation concerning the need for any goods or services. (eb) make a false or misleading representation concerning the place of origin of goods. approval or affiliation it does not have. right or remedy.ELECTRONIC MAIL AND ONLINE PRESENCE 251 a continuing publication. or (g) make a false or misleading representation concerning the existence. as by their very nature they are continuing publications. (aa) falsely represent that services are of a particular standard. Indeed. 13 See Chapter 12.html. guarantee. grade. The courts have 11 For example.13 Disclaimers – conditions of use Before proceeding to the main pages.

However. and those who are not. but also practical in terms of liability. The plaintiffs’ concerns have included the fact that links sometimes bypass the ‘home page’ thus avoiding security. With a time stamp. members of the public will be sure that they may rely on the advice. implementation of cookies. Some sites place a ‘frame’ around other sites. the gullible as well as the cautious. as part of the page template. Linking and framing Some US actions have been taken where the host site includes an ‘unauthorised’ link to another website. misleading and deceptive conduct provisions such as TPA section 52 have been applied broadly to sections of the community. The use of headers. Including the date of revision in such information tells users how current the information on the web pages is. above. Many law firms provide online legal bulletins to the general public. Information to be placed on pages for practical and legal purposes Other sites may link not to the host’s opening page but to some interesting feature in the middle of the pages. footers and frames is a way to provide fundamental information.252 LAW OF ELECTRONIC COMMERCE held that users are bound by such ‘agreements’. Many legal researchers cite the date they visited web pages for this very reason. Users need to find their way out of this situation. giving the appearance that the ‘framed’ site is the creation of the host site. 14 15 16 17 See Chapter 4.16 The liability for such framing is yet to be ironed out by the courts. in the end.15 All users (including website designers and administrators) need to understand the significance of such notices and to balance legal considerations with practical and aesthetic considerations. See Chapters 6 and 7. See World Series Cricket Pty Ltd v Parish (1977) 16 ALR 181. Design considerations should be not only aesthetically pleasing for marketing purposes. tracking techniques and stated terms and disclaimers. this will be an advantage to the host. . See Disclaimers. the profound.14 Some sites place less obvious links to the site’s terms and disclaimers. Consideration should be given to placing certain essential information on every web page.17 Actions may also be based on the tort of passing off. Many websites are directed to the general public. one of the dangers is that users rely on them for current information when the page may not in fact have been altered recently. A statement placed online regarding the law may quickly be obsolete. which the courts have described as the knowledgeable. on every page of a website. Although one of the advantages of websites is that they can be updated quickly. such as a privacy policy and disclaimers.

18 The professional office and email Just as each office maintains its own set of procedures in relation to the sending and receipt of mail and facsimiles. using clickwrap techniques. There are thousands of newsgroups where people discuss matters of common interest. It is too easy to create emails without the assistance of the secretarial staff and then press the send button. Victoria. Electronic gateways can be put in place by systems programmers. A mailing list permits a participant to send one message to a central computer and have the message then forwarded automatically to every email address on the list. 19 For example the secondary evidence rule applies in Queensland. Whatever the form of record-keeping set up. recipes to Star Trek.ELECTRONIC MAIL AND ONLINE PRESENCE 253 Newsgroups and mailing lists Newsgroup and mailing list administrators need to consider the same issues regarding liability as other online providers and email writers. legal offices must have in place a regimented system of creating and maintaining backup copies. or a scanned copy of paper documents. For electronic documents and records. Newsgroups and mailing lists allow participants to post messages to a central computer file for access by anyone. so each office must appropriately determine its approach to email. Issues of control and responsibility should be brought to the attention of users. as evidence. Some offices print duplicates and retain ‘hard copies’ in a physical file. see Chapter 17. consideration must be given to methods of backing up electronic mail. . Some have incoming mail on disk and backup daily or print out that mail for retention and filing while retaining the incoming mail on disk.19 Maintain supervisory checks If the organisation includes procedures for the checking by supervisors of mail or facsimiles before sending. then an appropriate gateway should be put in place to ensure that the checking process is maintained for email as well. carbon copies were often kept. 18 See Chapter 4. South Australia and Western Australia. In many jurisdictions it is vital to retain the electronic version: evidentiary rules may exclude a printout of an email. preferably contractually. Backup copies Before photocopying. from rugby to aliens.

when facsimiles are used. In certain cases the recipient may wish to know when the facsimile is being sent so that he or she may be on hand to receive it to ensure privacy and confidentiality. Where appropriate. As a parallel. However. it is usually prudent to ask the recipient in advance if sensitive information may be sent by that medium. the recipient may agree to the use of an encryption program as added security.com. 20 For a common public example. This problem existed with standard mail and facsimiles as well. or use it only in restricted ways. Most email systems allow the user to reply either with or without the body of the received message included in the reply. an appropriate procedure must be put in place to ensure that such work is costed. and that includes a copy of the original email. Staff acceptance and morale are important. and again when it has been read. Confidentiality is often most important. in appropriate situations – to send a reply that is as short as ‘Received’. Confirmation of sending One continuing problem with email is determining whether a particular email has been delivered and read. If the professionals now bypass such a system. The most certain method of reassurance is to ask the recipient – even insist. Organisations that do not yet use email. could consider undertaking a month’s trial of sending inter-office memos by email. because of the ease and speed of email. Confidentiality Email has a range of potential security problems. . It may be worthwhile to adopt a policy of sending confirmations and requesting confirmations from recipients. such facilities are dependent on the mail systems and protocols used by the other party or the mail path.20 Internal trial There are organisations which have severely restricted access to email facilities because they fear abuse by staff. see PGP: www. It would be prudent to prepare a standard communiqu´ regarding the risks e of email and obtain the recipient’s written consent before sending sensitive information electronically. This form of familiarity will lead to office acceptance and use. Some email programs claim to have a facility that will send a message to the sender when the email was received.254 LAW OF ELECTRONIC COMMERCE Records and costing Many offices used to have secretarial staff to keep records of the production of letters and other documents for costing purposes. Informing staff that there will be no more hard copies of memos will ensure that they open their email daily.pgpi.

regardless of whether or not hard copies have been created and maintained. with similar security constraints. Electronic communicators must be aware of the current laws that affect their actions. it may be misused. Sensitive hardcopy files may be kept locked in cabinets with limited access. each organisation must also determine its policies on email. and they must validate their documents in terms of the place of dispatch and receipt. Commercial expediency will win out. the timing of dispatch and receipt. the sending of these files could be regarded as constituting sexual harassment. A new form of expression There are reports from a number of organisations that they are having trouble with employees sending other employees attachments which are questionable movie files. Email and other forms of electronic communication are replacing the traditional formal letter. Conclusion Just as each organisation maintains procedures in relation to the dispatch and receipt of mail and facsimiles. they may need to be specific to particular uses. the admissibility of the email and attachments sent.ELECTRONIC MAIL AND ONLINE PRESENCE 255 Access to files A procedure that monitors and controls access to electronically saved files. and the result was the lex mercatoria. passwords to electronic data records should be entrusted in a similar way. a reactive body of law. such communications have always been undesirable in any form. Sometimes. Disclaimers can be effective. and like all other forms. should be put in place. This too is not new. Commercial parties forged ahead in centuries past without law that dealt with their actions. Just as a duplicate key may be entrusted to another person. . While the form of communication may now be electronic. this is preferable to defending legal proceedings because of a failure to do so. Using different passwords for different levels of sensitivity increases the security of documents. Many commercial parties have jumped into electronic commerce with little consideration of the legal consequences. Email is merely a new form of communication. With this comes several challenges. but should be drafted with care.

The USA PATRIOT Act In response to the attacks of September 11. Many of these measures affect cyberlaw and electronic commerce.15 National electronic surveillance Electronic surveillance methods have become the subject of several pieces of federal legislation since the events of September 11. debated and passed the Uniting and Strengthening America by Providing 256 . 2001. has been dramatically enhanced. Anti-terrorism legislation internationally has introduced powers and regulations which (among other things) have an impact on cyberlaw. Some anti-terrorism provisions permit Australian law enforcement and security agencies to intercept unread emails in routine investigations. there were no federal or state laws relating to terrorism. search and seize information. communications. In 2003. the internet and security (confidentiality and safe computer systems). the government announced the creation of an Ambassador for Counter-Terrorism. the government has since signed numerous memorandums of understanding on counter-terrorism. which called on all nation states to prevent and suppress the financing of terrorist acts. includes significant increases in powers of investigation and surveillance. electronically and otherwise. the Surveillance Devices Act 2004 (Cth). 2001 the US Congress drafted. the Australian government introduced a number anti-terrorism Bills. This chapter briefly examines these electronic surveillance measures. The most recent proposal. The extent to which law enforcement and security agencies can now intercept. beginning in March 2002. The Charter of the United Nations (Anti-Terrorism Measures) Regulations 2001 implemented aspects of UN Security Council Resolution 1373 of 28 September 2001. Prior to September 11. However. 2001.

the US Senate passed the Act by a vote of 98 to 1. all within seven weeks. It creates new crimes. 2 Criminal Code 1995 (Cth) s471.1 The maximum penalty is seven years’ imprisonment. Yet in the changed environment. The Act authorises nation-wide execution of court orders for pen registers. It mandates a specifically defined process for authorities that wish to use electronic surveillance. Australian response Criminal Code Amendment (Anti-Hoax and Other Measures) Act 2002 (Cth) This Act creates new offences relating to the use of postal services to perpetrate hoaxes. The Act contains features which previously would have made civil libertarians cringe. and computer and other forms of electronic communications in most instances. It is an offence to perpetrate a menace. dangerous or harmful substance has been left in any place. the making of threats and the sending of dangerous articles. and specifies that such surveillance is to be used only as a last resort in serious criminal cases. harass or cause offence in these terms. The Act contains a number of safeguards. A person is guilty of an offence if the person causes or threatens to cause an article to be carried by a postal or similar service. The court notifies the parties to any conversations seized under the order after the order expires. It includes powers to combat the use of US financial institutions for foreign money-laundering purposes. New computer crimes are created. new penalties. The Act gives US federal officials greater authority to track and intercept communications. but critics contend that these are inadequate. all for use against domestic and international terrorists. The Act prohibits electronic eavesdropping on telephone conversations.12. . Others are concerned that it does not go far enough. dangerous or harmful substance. both for law enforcement and foreign intelligence-gathering purposes.11. and new procedural efficiencies. Electronic cooperation between law enforcement and foreign intelligence investigators is encouraged.10. It tightens requirements for entry into the US and contains powers to detain and remove a wider class of persons.NATIONAL ELECTRONIC SURVEILLANCE 257 Appropriate Tools Required to Intercept and Obstruct Terrorism Act 2001 (commonly known as the PATRIOT Act). and that many of the Act’s provisions go too far. and does so with the intention of inducing a false belief that the article encloses or contains an explosive. faceto-face conversations.2 1 Criminal Code 1995 (Cth) ss471. trap and trace devices. and access to stored email or communication records. The Act permits authorities to intercept communications to and from a trespasser within a computer system. 471. or that an explosive.

and introduces a penalty for using the assets of those involved in terrorist activities. It implements international obligations.11 child pornography.1. Criminal Code 1995 (Cth) s102. Telecommunications (Interception and Access) Act 1979 (Cth) s5D(2)(d) .258 LAW OF ELECTRONIC COMMERCE Security Legislation Amendment (Terrorism) Act 2002 (Cth) This Act creates a new offence of ‘engaging in a terrorist act’. creates the offence of the collection of funds used to facilitate a terrorist act. Criminal Code 1995 (Cth) s72.10 Telecommunications Interception Legislation Amendment Act 2002 (Cth) The Act allows the use of telecommunications interception in the investigation of the following offences: conduct involving acts of terrorism. This makes it an offence to knowingly or recklessly fund a terrorist act.6 and to provide support to a terrorist organisation. 3 4 5 6 7 8 9 10 11 12 Criminal Code 1995 (Cth) s80.3 making it an offence to have certain links with terrorist organisations.1.5. requires financial institutions and cash dealers to report suspected terrorist-related transactions.9 The offences do not apply to defence force members.1.12 serious arson offences. within the terms of the Act.1. For example. Criminal Code 1995 (Cth) s115.4 to train with a terrorist organisation. The Attorney-General must consent to proceedings for offences under this Act. someone who murders an Australian outside Australia may face imprisonment for life.7 The Act enhances powers to deal with terrorist-related offences and creates a new regulations in relation to identifying terrorist organisations: six organisations have been specified under this new process. The effect is to modernise the offence of treason.5 to receive funds from a terrorist organisation.6. such as government facilities or places of public use.7. Telecommunications Interception Legislation Amendment Act 2002 (Cth) s5(1)(c). Criminal Code 1995 (Cth) s102. . Criminal Code 1995 (Cth) s102. Criminal Code 1995 (Cth) s102. and police officer conduct leading to a dismissal decision.1. Suppression of the Financing of Terrorism Act 2002 (Cth) This Act is designed to prevent the movement of funds for terrorist purposes.8 Criminal Code Amendment (Suppression of Terrorist Bombings) Act 2002 (Cth) This Act makes it an offence to place or detonate bombs or other lethal devices in prescribed places. Criminal Code 1995 (Cth) s103.

commit manslaughter or intentionally or recklessly cause serious harm to an Australian outside Australia. if necessary to achieve that purpose. the minister may allow the following: (a) where there is reasonable cause to believe that data relevant to the security matter may be accessible by using a computer or other electronic equipment. or creates a serious risk to the health or safety of the public or a section of the public. 14 Australian Security Intelligence Organisation Act 1979 (Cth) s25(5). (iii) copying any data to which access has been obtained. other than the life of the person taking the action. causes a person’s death. adding. to any data storage device and removing the device. that appears to be relevant to the collection of intelligence by the Organisation in accordance with this Act. brought to or found on the subject premises – using the computer. into documentary form and removing any such document.1. (ii) converting any data to which access has been obtained. In relation to warrants to access and search computers and electronic equipment.15 13 Australian Security Intelligence Organisation Act 1979 (Cth) s4. First there must be an action or threat of an action that causes serious harm that is physical harm to a person. equipment or device to do any of the following: (i) inspecting and examining any data to which access has been obtained. deleting or altering other data in the computer.14 ‘Terrorism act’ ‘Terrorism act’ is defined by the federal Criminal Code in three parts. .NATIONAL ELECTRONIC SURVEILLANCE 259 Criminal Code Amendment (Offences Against Australians) Act 2002 (Cth) The Act amends the federal Criminal Code by inserting new provisions to make it an offence to murder. 15 Criminal Code 1995 (Cth) s100. causes serious damage to property. or a data storage device. (b) using the computer. equipment or device for the purpose of obtaining access to any such data and. equipment or device.13 thus extending the investigative powers of ASIO in relation to terrorism permitting personal searches to be authorised in conjunction with search warrants and providing a power to detain and question people who are believed to have information about planned terrorist attacks for a period of seven days. that appears to be relevant to the collection of intelligence by the Organisation in accordance with this Act. Australian Security Intelligence Organisation Legislation Amendment (Terrorism) Act 2003 (Cth) The Act amends the Australian Security Intelligence Organisation Act 1979 (Cth) by reincorporating terrorism within the definition of ‘politically motivated violence’. endangers a person’s life.

or (iv) to create a serious risk to the health or safety of the public or a section of the public.1(2)e. However. and (b) is not intended: (i) to cause serious harm that is physical harm to a person. a transport system. 100. .1(1). it is a terrorist act to: seriously interfere with. Additionally. which commenced on 30 June 2004. Compared with other nations. other than the person taking the action. extendable for a further five days. 17 Criminal Code 1995 (Cth) ss100. or (v) a system used for. territory or foreign country. 18 Criminal Code 1995 (Cth) s100. 16 Criminal Code 1995 (Cth) s100.18 Anti-Terrorism Act 2004 (Cth) This Act. or by.260 LAW OF ELECTRONIC COMMERCE In relation to electronic systems. or (ii) to cause a person’s death. protest.1(2).1(3). or influencing by intimidation. the action must be done or the threat be made with the intention of advancing a political. For example. territory or foreign country or intimidating the public or a section of the public. an essential public utility. but it can still add an extra 23 hours. In Britain. dissent or industrial action. or (iii) a financial system. emergency authorisations and authorisations for the installation and use of surveillance devices in Australia and overseas. it regulates the use. or (iv) a system used for the delivery of essential government services. including. doubles the questioning time for terrorist suspects to 24 hours. but not limited to: (i) an information system. this is quite modest. This cannot ‘exceed the amount of the time zone difference’. the action must be done or the threat be made with the intention of coercing. an electronic system. the government of the Commonwealth or a state. or of part of a state. or (ii) a telecommunications system.16 Second. or by. or (vi) a system used for. seriously disrupt. the Australian Act provides for time when the clock does not run. the police can detain suspected terrorists for 48 hours. religious or ideological cause. Surveillance Devices Act 2004 (Cth) This Act establishes procedures for enforcement agencies to obtain warrants. or (iii) to endanger the life of a person. Third.17 A terrorist act does not include an action if it: (a) is advocacy. or destroy. time waiting for a reply from international agencies.

The federal government provided $14. publication. our police must be able to match and better them. The Act imposes requirements for the secure storage and destruction of records obtained by police through the use of surveillance devices. The purpose is to regulate the use of surveillance devices. Anti-Terrorism Act (No. to enable them to use the new surveillance device powers provided in the Act. destruction and making of records in connection with surveillance device operations. protection of witness identity and electronic surveillance. In addition. as criminal and terrorist groups make use of sophisticated technology. to restrict the communication and publication of records of private conversations and to establish procedures for law enforcement officers to obtain warrants or emergency authorisations.5 million over four years. Victoria has passed the Surveillance Devices Act 1999. The then Attorney-General. the Telecommunications (Interception) Amendment (Stored Communications) Act 2004 (Cth). . Surveillance Devices Bill 2004. funds are provided to the Commonwealth Ombudsman and the Administrative Appeals Tribunal in support of these new powers. assumed identities. 2) 2005 (Cth) This Act amends the law relating to terrorist acts to bring it in line with international developments. paedophiles and criminals involved in national and transnational crime. . Electronic surveillance is regarded as a crucial tool for effective and efficient law enforcement. terrorists. (from 2004) to the Australian Federal Police and the Australian Crime Commission. a tiny microphone or camera hidden in a suspect’s vehicle to a piece of software to capture the input of information to a computer . state and territory officials was established. A regime was 19 Second Reading Speech. Philip Ruddock. SMS and voice mail messages. storage. told the Federal Parliament: One increasingly important tool is the use of surveillance devices. Complementary legislation. . This includes access to undelivered email. A joint working group of Commonwealth. The Act extends the definition of ‘terrorist organisation’ to enable the listing of organisations that advocate terrorism.NATIONAL ELECTRONIC SURVEILLANCE 261 communication. which can range from a pair of binoculars. removes the need for a telecommunications interception warrant under the Telecommunications (Interception and Access) Act 1979 (Cth) in order to access the content of communications temporarily delayed and stored on a telecommunication service provider’s equipment during passage.19 The Act began as an initiative of the Leaders’ Summit on Terrorism and MultiJurisdictional Crime held in April 2002. The joint working group has developed model laws to improve cross-border criminal investigations in the areas of controlled operations. especially in pursuing serious drug traffickers.

but the police still need to apply to the Supreme Court for an authorisation in relation to a specific event or area. It tightened up provisions regarding offences of financing of terrorism: there is now better coverage of the collection of funds for terrorist activity. search and seize powers that will be exercisable at airports and other Commonwealth places to prevent or respond to terrorism.21 It was one of the government’s actions taken in response to the events of September 11. which allow for the overt close monitoring of terrorist suspects who are considered to pose a risk to the community. In the 2006/07 Budget. Some states have enacted mirror legislation to provide for similar stop and search powers for state police in relation to events or areas. The Act gives law enforcement and intelligence agencies access to airline passenger information and creates a legal basis for the use of video surveillance at Australia’s major airports and on aircraft. 22 See Minister for Foreign Affairs. the Terrorism (Community Protection) Act 2003 (Vic).22 In announcing the appointment of a new ambassador in 2006 the Minister for Foreign Affairs described the responsibility of the Ambassador in the following terms: The Ambassador for Counter-Terrorism is responsible for the development and implementation of Australia’s international counter-terrorism policy.20 Ambassador for Counter-Terrorism On 7 March 2003 the position of Ambassador for Counter-Terrorism was created. There is a new regime of stop. where they believe it is ‘reasonably necessary to prevent a terrorist act’ or to preserve evidence of such an act.23 20 For example.262 LAW OF ELECTRONIC COMMERCE established in relation to ‘control orders’. This entails identifying needs and opportunities for practical action to counter the terrorist threat and maximising Australia’s capacity to respond to these internationally. The Act updated sedition offences so that they now cover those who urge violence or assistance to Australia’s enemies.au/releases/ 2006/fa079_06.gov.au/homs/auct. The role of the Ambassador is to facilitate cooperation within Australian agencies and between Australian agencies and their international counterparts. question. The powers may also be exercised carte blanche in a ‘prescribed security zone’. 21 See www. press release.html. July 2006: www.dfat.html. 23 Ibid. . Police may detain a person without charge for up to 48 hours as a ‘preventative detention’ measure. the Australian government provided an additional $92. 2001.gov.foreignminister. The Ambassador has a key role in ensuring a coherent and effective approach to Australia’s counter-terrorism cooperation with both regional and extra-regional partners.6 million over four years to ‘boost Australia’s capacity to work with regional partners to combat the continuing and evolving threat of terrorism’.

Malaysia. Implemented under the Crimes (Aviation) Act 1991 (Cth). such as Al Qaida.au/releases/ 2005/fa161_05. Implemented under the Crimes (Aviation) Act 1991 (Cth). 24 See Minister for Foreign Affairs. . Cambodia. December 2005: www. Implemented under the Crimes (Aviation) Act 1991 (Cth). joint training activities and capability building initiatives. Afghanistan and the United States.24 International Conventions Australia is party to 11 of the 12 anti-terrorism Conventions. Fiji. intelligence.gov. East Timor. in December 2005 Australia signed an MOU with Afghanistan. They are intended to establish a bureaucracy to coordinate security. For example. the Philippines. law enforcement and defence issues. Convention for the Suppression of Unlawful Seizure of Aircraft 1970 (Hague Convention) Australia signed the Hague Convention on 15 June 1971 and ratified it on 9 November 1972. which covers the hijacking of a civilian aircraft. Strong international cooperation is crucial in combating the global terrorist threat. They have been implemented into Australia’s domestic legislation as follows: Convention on Offences and Certain Other Acts Committed on Board Aircraft 1963 (Tokyo Convention) Australia deposited an Instrument of Accession in 1970. press release. Thailand. This CT MOU will enhance the security of both Australia and Afghanistan through exchanges of information and intelligence. Papua New Guinea. education and technical assistance programs in counterterrorism.html.NATIONAL ELECTRONIC SURVEILLANCE 263 Memorandums of Understanding on counter-terrorism Australia has signed a number of memorandums of understanding on counterterrorism: with Indonesia. India. Pakistan.foreignminister. The Minister for Foreign Affairs stated: Afghanistan is an important ally for Australia in the war on terror and has played a pivotal role in international efforts to dismantle global terrorist networks. Convention for the Suppression of Unlawful Acts against the Safety of Civil Aviation 1971 (Montreal Convention) Australia signed the Convention on 12 October 1972 and ratified it on 12 July 1973. They also make provision for training. Brunei.

Implemented under the Crimes (Ships and Fixed Platforms) Act 1992 (Cth). or deliberately endanger shipping through sabotage or misinformation. Implemented under the Nuclear Non-Proliferation (Safeguards) Act 1987 (Cth). Protocol for the Suppression of Unlawful Acts Against the Safety of Fixed Platforms Located on the Continental Shelf 1988 (Rome) (Supplementary to the Convention for the Suppression of Unlawful Acts Against the Safety of Maritime Navigation 1988 (Rome)) This Protocol makes it an offence to hijack a fixed platform. Implemented under the Crimes (Internationally Protected Persons) Act 1976 (Cth). Australia deposited an Instrument of Accession on 19 February 1993. Implemented under the Crimes (Ships and Fixed Platforms) Act 1992 (Cth).264 LAW OF ELECTRONIC COMMERCE Supplementary Protocol for the Suppression of Unlawful Acts of Violence at Airports Serving International Civil Aviation 1988 (Montreal) Australia deposited an Instrument of Accession on 23 October 1990. effective 22 November 1990. . effective 20 May 1993. Convention for the Suppression of Unlawful Acts against the Safety of Maritime Navigation 1988 (Rome) This Convention makes it an offence to hijack a civilian ship. The Protocol entered into force on 1 March 1992. effective 20 May 1993. Convention on the Physical Protection of Nuclear Material 1980 (Nuclear Materials Convention) Australia signed the Convention on 22 February 1984 and ratified it on 22 September 1987. which may endanger its safety. Implemented under the Crimes (Hostages) Act 1989 (Cth). The responsible body is the International Maritime Organisation (IMO). which might endanger the safe navigation of the ship. or attack a person on board a civilian ship or the ship itself. Australia deposited an Instrument of Accession on 19 February 1993. International Convention against the Taking of Hostages 1979 (Hostages Convention) Australia deposited an Instrument of Accession on 21 May 1990. attack a person on board a fixed platform or the platform itself. The Convention came into force 1 March 1992. Convention on the Prevention and Punishment of Crimes Against Internationally Protected Persons 1973 Australia signed the Convention on 30 December 1974 and ratified it on 20 June 1977. Implemented under the Crimes (Aviation) Act 1991 (Cth).

and was deposited with the United Nations. Australia is not a party to this Convention. Implemented under the Suppression of the Financing of Terrorism Act 2002 (Cth). public transport or infrastructure. and any other act intended to cause death or serious bodily injury to a civilian. International Convention for the Suppression of the Financing of Terrorism 1999 (New York) This Convention makes it an offence to unlawfully and wilfully provide or collect funds with the intention of carrying out one of the offences listed in the above Conventions. Australia deposited an Instrument of Accession on 8 September 2002. place. . or to any other person not taking an active part in the hostilities in a situation of armed conflict. Implemented under the Criminal Code Amendment (Suppression of Terrorist Bombings) Act 2002 (Cth). discharge or detonate an explosive or other lethal device into or against a public place. The Convention entered into force on 10 April 2002.NATIONAL ELECTRONIC SURVEILLANCE 265 International Convention for the Suppression of Terrorist Bombings 1997 (New York) This Convention makes it an offence to unlawfully or intentionally deliver. and was deposited with the International Civil Aviation Organisation (ICAO). The Convention entered into force on 21 June 1998. major economic loss. citing conflicts with commitments to international human rights conventions and guarantees under the rule of law. The Convention entered into force on 23 May 2001. when the purpose of such an act is to intimidate a population. or to compel a government or an international organisation to do or abstain from doing any act. facility or system. Australia signed the Convention on 15 October 2001 and ratified it on 26 October 2002. with intent to cause death or serious injury. or is likely to result in. or extensive damage to the place. Conclusion The debate continues in relation to the powers and measures that authorities should have so that they can undertake appropriate action for the prevention of terrorism. and about a perceived lack of transparency. a state or government facility. where the destruction results in. and was deposited with the United Nations. International Convention for the Marking of Plastic Explosives for the Purposes of Detection 1991 (Montreal) This Convention makes it an offence to fail to properly mark plastic explosives for the purposes of detection. Civil libertarians express outrage at the curtailment of fundamental human rights and freedoms.

it may be the beginning of permanent laws and tools to counter terrorism. via interceptions.266 LAW OF ELECTRONIC COMMERCE These new powers affect the ‘right to silence’. However. Decisions made under these powers are not subject to judicial review. this period of time may be viewed as a dark age. and there remain questions about the nexus between the alleged breach and a terrorist act or a terrorist organisation. ‘wire tapping’ and surveillance. and freedoms of expression and association. the right to confidential legal advice. In the future. The powers given to law enforcement agencies allow for extensive access to electronic systems of all kinds. .

information on how to make bombs and information about suicide techniques. Sending an email to place a virus can be unlawful. The free flow of information has generated undesirable and abhorrent material. worms (programs or codes which replicate themselves using a network system. 2 AusCERT. In surveys undertaking by the Australian Computer Emergency Response Team (AusCERT). 267 . New offences have been created in response to these concerns. or misused. There is no accepted definition of computer crime. Many crimes that are not specifically related to computers can be substantially facilitated by the use of computers. 2006 Australian computer crime and security survey. AusCERT is an independent. to elicit or manipulate data or processing. Persons gaining unlawful access to computers for these purposes are typically referred to as crackers: hackers with malicious intent. This area is often referred to as cybercrime. Telecommunications may be involved.16 Cybercrime The advance of information technology and computer technology has led to a corresponding increase in computer crime.2 the most common breaches involved viruses (programs or codes that can replicate themselves and infect computers without the owner’s consent and often without the owner’s knowledge). The public has expressed concern about pornography. The result may be a transfer of funds or of confidential information. or a computer may be used to commit a crime. and that are designed to 1 The US has many unique examples of computer crime – stealing an ATM with a front-end loader or shooting an ATM with a handgun. not-for-profit team of IT security professionals.1 Typically a computer is used. Crimes involving electronic commerce typically involve the use of computers and telecommunications. based at the University of Queensland. such as theft. Computers may be the subject of a crime. Simple unlawful access to a computer system can be regarded as an offence.

7 See Cybercrime Bill 2001 (Cth) Explanatory Memorandum. ‘Technological change and the Australian Constitution’. laptop theft and financial fraud – generated the highest cost to the surveyed organisations.5 The majority of computer crime is committed using telecommunication networks such as the telephone systems and the internet. Such criminal activities cost individuals and organisations internationally several trillion dollars per annum. www. malicious damage. finance.7 specifically the 25th draft. the power has been interpreted as including modern telecommunications. Ex parte Williams (1935) 54 CLR 262 and Jones v Commonwealth [No.au/legis.4 Although the drafters of the Constitution did not envisage the internet.268 LAW OF ELECTRONIC COMMERCE cause malicious damage) and Trojan infections (code incorporated into an existing program which gives the appearance of performing a desirable function but which performs malicious functions). The second most common breach was laptop theft. internet gambling. 32 per cent in 2006. so cybercriminals have also crossed the technological boundaries. The percentage of organisations reporting electronic attacks on organisations that harmed confidentiality. viruses. telegraphic. The former Act was based on a draft of the Council of Europe Convention on Cybercrime.gov. These have been superseded by the amendments to the federal Criminal Code 1995. telephonic. but in 2005 and 2006 the proportion dropped to 60 per cent.aph. child pornography and child grooming online and more. Security breaches – in particular. and the number of organisations included differed from year to year. by the Cybercrime Act 2001 (Cth)6 and by the Crimes Legislation Amendment (Telecommunications Offences and Other Measures) Act (No. . 5 Geraldine Chin. (2000) MULR 25. federal and state government. 6 See Second reading speech of Attorney-General Daryl Williams. integrity or availability of network data or systems decreased from 42 per cent in 2003 to 22 per cent in 2006. released on 3 The organisations surveyed represent the manufacturing.htm. spam.3 In 2003 and 2004. 2) 2004 (Cth). because the Australian Constitution includes ‘postal. and education sectors. See R v Brislan. utilities. This chapter examines cybercrime: unlawful access. Amendments to the Crimes Act 1914 (Cth) in 1989 introduced a range of limited computer offences. The Commonwealth Criminal Code and computer crime In Australia cybercrime is generally dealt with by federal law. 4 Australian Constitution s51(v). 80 per cent of organisations experienced this type of breach. information technology. and other like services’ as legislative powers of the federal Parliament. 2] (1965) 112 CLR 206. Insider abuse of computer systems increased: 26 per cent of organisations reported this in 2003. Just as fraudsters use the latest technology to gain an advantage. cyberstalking.

which is 10 years’ imprisonment. 8 9 10 11 12 13 14 15 16 See Council of Europe website: conventions. The maximum penalty for this offence is 10 years’ imprisonment. The maximum penalty for this offence is 10 years’ imprisonment.14 It is an offence for an unauthorised person to access or modify data that is protected by a password or some other security feature.2. For example. or any program (or part of a program)’.1. if a person hacked into a bank computer and accessed credit card details with the intention of using the details to obtain money. It is an offence to access or modify computer data or impair electronic communications to or from a computer without authority. The offence covers a range of situations. Criminal Code 1995 (Cth) s477. The offence targets hackers attempting to circumvent passwordprotected computer systems. . with the intention of committing a serious offence.16 The maximum penalty for this offence is two years’ imprisonment. This prohibits strategies such as ‘denial of service attacks’. This offence recognises the importance of internet communications. The maximum penalty for this offence is equal to the maximum penalty for the serious offence. . ‘Data’ includes ‘information in any form . Criminal Code 1995 (Cth) Dictionary. This is referred to as restricted data. and (b) to which access is restricted by an access control system associated with a function of the computer’. for example. including a hacker who obtains unauthorised access to a computer system and impairs data and a person who circulates a disk containing a computer virus which infects a Commonwealth computer.coe.1.int/. Ibid.3.9 The Cybercrime Act inserted seven computer offences into the Criminal Code 1995 (Cth). Criminal Code 1995 (Cth) s477. Hackers often experiment with computer code unsure of the consequences and with no specific intent.1. . the penalty would be equivalent to that for the fraud offence.15 ‘Restricted data’ is defined as ‘(a) data held in a computer.8 The Council of Europe released the Final Draft on 29 June 2001.CYBERCRIME 269 22 December 2000. Criminal Code 1995 (Cth) s478.13 Another offence is causing an unauthorised impairment of electronic communications to or from a computer knowing that such impairment is unauthorised.10 A ‘serious offence’ is defined as an offence punishable by five or more years’ imprisonment.12 Proving intent is always problematic. Criminal Code 1995 (Cth) Dictionary. It is an offence for a person to cause unauthorised modification of data in a computer where that person is reckless as to whether that modification will impair data. a service provider is swamped by useless messages causing the service to be inoperative. Criminal Code 1995 (Cth) s478. Criminal Code 1995 (Cth) s477. where.11 ‘Electronic communication’ is defined as ‘communication by means of guided or unguided electromagnetic energy or both’.

and have originated within another jurisdiction. Dishonesty is determined by reference to the standards of ordinary people.17 Finding evidence of these computer offences is problematic. Division 474 contains the substantive provisions dealing with telecommunication offences. 474. Division 474 begins with general dishonesty provisions. a carriage service provider by way of the supply of a carriage service.2.4. 22 See Criminal Code 1995 (Cth) ss474.21 It is a broad definition intended to cover future technologies. 20 For applicable decisions on the prior legislation see R v Idolo [1998] VICSC 57. A person similarly commits an offence for knowingly risking such a loss. 19 The Crimes Legislation Amendment (Telecommunications Offences and Other Measures) Act (No 2) 2004 (Cth) replaced the previous Part 10. The maximum penalty for each of these offences is three years’ imprisonment. cables and optical fibre: unguided electromagnetic energy includes radio and infra-red waves.6 includes a broad list of definitions which are technology specific. the Criminal Code also makes it an offence to possess.6 applies to the generic medium of ‘carriage service’. They may be difficult to trace.270 LAW OF ELECTRONIC COMMERCE The Criminal Code targets destructive actions such as passing a magnet over a credit card or cutting a computer disk in half.2. which was notable for its brevity and lack of detail. it is an offence to cause unauthorised impairment of the reliability. Service carriage is given the same meaning as defined in the Telecommunications Act 1997 (Cth): ‘a service for carrying communications by means of guided and/or unguided electromagnetic energy’.6. DPP (Cth) v Rogers [1998] VICSC 48 and R v Stevens [1999] NSWCCA 69. 21 Criminal Code 1995 (Cth) Dictionary. email and SMS messages. In an attempt to address such concerns. 478. control or supply data or programs which are intended for use in the commission of a computer offence.22 17 Criminal Code 1995 (Cth) s478. The offences cover persons who possess.1. . A person is guilty of an offence if the person does anything with the intention of dishonestly obtaining a gain from.20 Part 10.18 Telecommunications services The Criminal Code 1995 (Cth) Part 10. create or trade in programs and technology designed to hack or damage other computer systems.3. 18 Criminal Code 1995 (Cth) ss478. The maximum penalty for this offence is two years’ imprisonment. or causing a loss to. Specifically. Guided electromagnetic energy utilises a physical means such as a wire.19 Division 473 of Part 10. The maximum penalty is five years’ imprisonment. which includes the internet.6 contains comprehensive provisions dealing with telecommunications services. These include criminal offences that involve use of the internet and other telecommunications and carriage services: internet child pornography and child abuse and assisting suicide. security or operation of any data held on a Commonwealth computer disk or credit card or other device.

supplying and obtaining. where adults use the internet to forge relationships with children as a first step in luring them into sexual abuse. 474. possessing or controlling such data or devices with the same intent is also an offence.28 Improper use of emergency call service is also an offence. harass or cause offence are offences. the approaches taken varied. such as access and manipulation of computer systems.8 respectively. 474. Criminal Code 1995 (Cth) ss474.19–474.6 respectively.26 Using a telecommunications network with intention to commit a serious offence is an offence. . Criminal Code 1995 (Cth) ss474. A prosecutor will have quite an arsenal. Criminal Code 1995 (Cth) ss474. or interfere with. producing. Criminal Code 1995 (Cth) s474. supplying or obtaining data or a device with intent to modify a telecommunications device identifier is an offence.18.30 The new offences target online ‘grooming’ activities by offenders. referring to specific mediums and intent. a hoax threat or to menace. Division 474 goes beyond this.7. Possessing or controlling data or a device with intent to modify a telecommunications device identifier is an offence.27 Notably.10.17. It is an offence if a person causes a communication to be received by a person or carriage service other than the person or service to whom it is directed.25 Copying subscriptionspecific secure data from an existing account or onto a new account identifier is an offence.29. child pornography offences were dealt with by the states and territories. using a carriage service to make a threat. The Criminal Code 1995 (Cth) now provides a consistent nationwide approach. and in particular covering acts such as possessing.16.14. to contact vulnerable children. a carriage service facility. the legislature has created many overlapping offences. certain employees. Criminal Code 1995 (Cth) s474.24 Producing. In their attempt to be comprehensive. 474. 474. and law enforcement agencies and intelligence and security officers in the course of their duties. though there are a range of defences for manufacturers.CYBERCRIME 271 The focus of Division 474 is the misuse of carriage services and telecommunications including International Mobile Equipment Identity (IMEI) (the actual phone number) and mobile phone Subscriber Identity Module (SIM) card data. It is also an offence to tamper with. The early legislative approach was to simply deal with concepts.15. Criminal Code 1995 (Cth) s474. 23 24 25 26 27 28 29 30 Criminal Code 1995 (Cth) ss474.23 Modifying or interfering with a telecommunications device identifier is an offence.5.11 respectively. A federal approach was warranted given the extensive use made of the internet to upload and download child pornography and the use of internet communications.9. 474. Criminal Code 1995 (Cth) ss474. such as email and chat rooms.29 Child pornography Prior to 2005.

The term ‘offensive’ can vary from person to person and community to community. the conduct is necessary for or of assistance in enforcing the law.22. monitoring compliance with. 33 This case permits online pornography under the guise of freedom of speech and freedom of expression and is the foundation of the escalation of online pornography in the modern era.34 The penalty is imprisonment for 10 years. 34 Criminal Code 1995 (Cth) ss474.1. and the material is child pornography or child abuse material. cause material to be transmitted.’38 Action by law enforcement authorities in accessing and 31 Criminal Code 1995 (Cth) s473. the administration of justice.33 The Criminal Code includes a guide for determining whether or not material is offensive: 473.35 Possessing. and only if. transmit material. each specific provision concludes with the expression: ‘and does this in a way that reasonable persons would regard as being. 474. offensive’.19. producing. or a particular use of a carriage service. medical or educational research that has been approved by the relevant minister in writing. legal or scientific character).37 ‘In determining whether the person is . supplying or obtaining child pornography or child abuse material for use through a carriage service is an offence punishable by up to 10 years’ imprisonment. 474. 32 521 US 844 (1997). in all the circumstances. or in conducting scientific.4 Determining whether material is offensive The matters to be taken into account in deciding for the purposes of this Part whether reasonable persons would regard particular material.24. artistic or educational merit (if any) of the material. or publish or otherwise distribute material.23. make material available online. A person is guilty of an offence if the person uses a carriage service to: access material. The expression ‘reasonable adult’ provides flexibility. 36 Criminal Code 1995 (Cth) ss474. not criminally responsible for the offence.19.272 LAW OF ELECTRONIC COMMERCE ‘Child pornography’ and ‘child abuse’ are defined in detail. 37 Criminal Code 1995 (Cth) s474. 38 Criminal Code 1995 (Cth) s474. . offensive.31 However. 474. decency and propriety generally accepted by reasonable adults.22. and (c) the general character of the material (including whether it is of a medical. or investigating a contravention of the law. as being. controlling. 35 Criminal Code 1995 (Cth) ss474. Conduct is of public benefit if. and (b) the literary. in all the circumstances. .20. The inability by the US Supreme Court in Reno v American Civil Liberties Union32 to determine a unified standard of ‘offensive’ within the US community was a significant part of the rationale for invalidating much of the US Communications Decency Act 1996. include: (a) the standards of morality. .36 It is a defence to such prosecutions to find that the conduct in question is ‘for the public benefit’. Janet Reno was the Attorney General for the Clinton Administration.24. the question whether the conduct is of public benefit is a question of fact and the person’s motives in engaging in the conduct are irrelevant. it is therefore also imprecise.

A person (the sender) commits an offence if he or she uses a carriage service to transmit a communication to another person (the recipient) and: • the communication includes material that is indecent.40 or to manufacture. or submit to. and • the sender or the third party is at least 18 years of age. inserted by Criminal Code Amendment (Suicide Related Material Offences) 2004 (Cth). develop or update certain content filtering technology (including software). or who the sender believes to be. A person may be found guilty of an offence even if the suicide is impossible.44 The offence also covers persons who possess. control. 42 Criminal Code 1995 (Cth) s474. sexual activity with the sender or another person (the third party). • the sender does this with the intention of making it easier to procure the recipient to engage in. • the recipient is someone who is.29A.24. SMS messages and voicemail.43 Assisting suicide The ease with which information can be accessed online has prompted a response by lawmakers. see Chapter 18. are also exempt. 43 Criminal Code 1995 (Cth) s474. under 16 years of age.39 Acts in good faith for the sole purpose of assisting the Australian Communications Media Authority (ACMA) to detect prohibited content (within the meaning of Broadcasting Services Act 1992 (Cth) Schedule 7). produce.24. An element of the offence is that the person intended the material to be used for counselling or inciting suicide. On the role of ACMA and detecting ‘prohibited content’.29B. 41 Criminal Code 1995 (Cth) ss474. ‘Indecent’ means ‘indecent according to the standards of ordinary people’. 44 Criminal Code 1995 (Cth) ss474. supply or obtain suicide-related material for use through a carriage service.27.21. transmit or make available material (such as on an internet web page) that directly or indirectly counsels or incites suicide. 474.24. It refers to enticing a child with the intent of engaging in sex.CYBERCRIME 273 downloading the material in the performance of their duty is not an offence. 40 Criminal Code 1995 (Cth) s474. distribute.41 The term ‘grooming’ is not defined. The 39 Criminal Code 1995 (Cth) s474. Police and security powers Law enforcement and security agencies are able to monitor and eavesdrop on suspected terrorists’ and criminals’ emails. 474. It is also an offence to use a carriage service to promote a particular method of committing suicide. another flexible and imprecise term.27.42 The maximum penalty is 12 years. A person is guilty of an offence if that person uses a carriage service to access. .

or is accessible from. (c) convert the data into documentary form. Police may analyse the computer on site or seize computer equipment. such as Internet Service Providers (ISPs).274 LAW OF ELECTRONIC COMMERCE federal Parliament passed problematic telecommunications interception legislation which had been sought by police. Encrypted data can be impossible to decipher. apart from the sender and intended recipient. A magistrate may order a person with knowledge of a computer system to provide information or assistance. (2) The magistrate may grant the order if the magistrate is satisfied that: (a) there are reasonable grounds for suspecting that evidential material is held in. keys.48 Investigative powers The Cybercrime Act 2001 (Cth) enhanced the criminal investigation powers under the Crimes Act 1914 (Cth) and the Customs Act 1901 (Cth) relating to the search. The use of security measures such as encryption and passwords present particular problems for law enforcement agencies. a computer that is on warrant premises. 49 Crimes Act 1914 (Cth) s3LA. 46 Telecommunications (Interception and Access) Act 1979 (Cth) s117. without the assistance of an employee of the carrier.47 Recent amendments substantially improved the original telecommunications interception legislation. but does not pass over a telex system. seizure and copying of electronically stored data. and 45 Telecommunications (Interception and Access) Act 1979 (Cth). to be copied and analysed elsewhere. (b) copy the data to a data storage device. . codes. suspects the existence of the message – it is a form of security through obscurity) used to protect information ‘as is necessary and reasonable’: 3LA(1) The executing officer may apply to a magistrate for an order requiring a specified person to provide any information or assistance that is reasonable and necessary to allow the officer to do one or more of the following: (a) access data held in.46 A ‘stored communication’ is a communication that is held on equipment that is operated by a carrier and cannot be accessed on that equipment. cryptographic and steganographic methods (the art and science of writing hidden messages in such a way that no one. 48 For more on the express powers see Chapter 15.45 Authorities are able to apply for search warrants to inspect ‘stored communications’. the computer. 47 ‘Carrier’ means a carrier and a carriage service provider within the meaning of the Telecommunications Act 1997 (Cth). regulatory and security agencies to aid investigations. including data storage disks.49 This power extends to the compulsory disclosure of passwords. or accessible from. which was drafted at a time when telecommunications was largely land-based and involved live telephone conversations. by a person who is not a party to the communication.

Criminal Code Act 1983 (NT) s276B.51 State legislative offences relating to computers There has been no uniform approach taken in relation to offences relating to the use of computers in electronic commerce or otherwise.53 In addition. Criminal Code 1899 (Qld) ss408D. dishonest use of computers. Information Gathering.50 Some commentators have described the new investigative powers as draconian and dangerous. Criminal Code 1924 (Tas) s257D. (3) . scanners and virus code. . In reality the police can break open a filing cabinet if necessary. often colloquially referred to as the right to silence. 51 See Part IAA – Search. and (c) the specified person has relevant knowledge of: (i) the computer or a computer network of which the computer forms a part. Queensland. Every Australian state and territory legislature has prohibited unlawful access to a computer. 408E. Criminal Code Act 1913 (WA) s440A. the computer. Tasmania and the ACT have specific legislation dealing with damage to computer data. terrorist activities and any criminal who hides material in an encrypted form. the provision provides law enforcement agencies with a necessary tool to fight crime. or (iii) an employee of the owner or lessee of the computer. Crimes Act 1958 (Vic) s247B. there are a range of offences relating to the misuse of computers. Supporters of the provision claim that it is a valuable tool to fight organised crime.52 Only New South Wales. fraudulent use of computers. Their argument is that the provision contravenes the privilege against self-incrimination. There has also been exaggerated criticism of the provisions which make it offence to possess hacker toolkits. Criminal Code 1899 (Qld) s408D(2). obtaining 50 Some accused may prefer to accept imprisonment rather than reveal the contents. 308I. or accessible from. on the basis that these are tools of the trade for security vendors. but they need the ‘key’ to access encrypted computer data. The provision is akin to requiring a person to hand over a key to a filing cabinet. Arrest and Related Powers. Criminal Code 2002 (ACT) s415. In fact. or (ii) measures applied to protect data held in. paedophilia. 52 Crimes Act 1900 (NSW) s308C. Failing to comply with the magistrate’s order is punishable by up to six months’ imprisonment. Summary Offences Act 1953 (SA) s44. Criminal Code 2002 (ACT) s416. Criminal Code 1924 (Tas) s257C. The Crimes Act 1914 (Cth) permits both the Defence Signals Directorate. 53 Crimes Act 1900 (NSW) ss308.CYBERCRIME 275 (b) the specified person is: (i) reasonably suspected of having committed the offence stated in the relevant warrant. or (ii) the owner or lessee of the computer. the Australian Security Intelligence Organisation (ASIO) and the Australian Secret Intelligence Service (ASIS) to hack: it is seen as part of their role of providing national security. ‘Misuse’ includes the falsification of documents.

and online child exploitation. Criminal Code 1899 (Qld) ss228. ● proactively targets and electronically patrols places where crime occurs. Criminal Code Act 1913 (WA) s440A. Criminal Code 2002 (ACT) ss412–421. it assists with the alignment of cybercrime legislation internationally.nz/resources/2007/e-crime-strategy/e-crime-strategy.57 The Crimes Act 1961 (NZ) contains limited cybercrime provisions.54 The Northern Territory has a specific provision dealing with unlawful appropriation of access time. focusing on high priority areas such as organised crime. any computer system without authorisation. 408E. 56 See Howard Broad. (2007) Electronic crime strategy to 2010: Policing with confidence: www. offenders and technologies involved in the commission of an offence.55 New Zealand The official approach by the New Zealand government has been to pursue a common cybercrime policy by adopting the Council of Europe’s Cybercrime Convention. directly or indirectly. 59 Crimes Act 1961 (NZ) s249. 57 Ibid. Criminal Code 1924 (Tas) ss257A–257F. Summary Offences Act 1953 (SA) ss44–44A.276 LAW OF ELECTRONIC COMMERCE property by deception and child pornography.59 A person who ‘intentionally accesses. extending the reach and speed of investigations. 276–276F. but there is also an ongoing review. Crimes Act 1958 (Vic) ss247–247H.police. 55 Criminal Code Act 1983 (NT) s276E.58 Accessing a computer system for a dishonest purpose attracts a potential penalty of seven years’ imprisonment where the person obtains any property. 222. 58 Updated in 2003 by the Crimes Amendment Act 2003 (NZ). violence. . The aim is the protection of society against cybercrime through appropriate legislation and cooperation between countries and private industry.html. New Zealand legislation is generally aligned with the Convention’s requirements. the police can progress cyber-based investigations across borders with other participating countries. Countries which have adopted the Convention legislate standards guiding the definition of and response to cybercrime. An attempt to do any of these things attracts a potential penalty of five years’ imprisonment. knowing that he or she 54 Crimes Act 1900 (NSW) ss308–308H. ● coordinates police response to cybercrime reported in New Zealand. benefit. privilege. New Zealand Police Commissioner. service. ● coordinates police response to transnational cybercrime in which there can be any combination of New Zealand or overseas victims. The NC3 is a specialist e-crime response and investigation group that: ● provides a single reporting point for cybercrime enabling the collection and investigation of complaints. pecuniary advantage. 125B.govt. Criminal Code Act 1983 (NT) ss125A. or valuable consideration or causes loss to any other person. Second. This approach is intended to have a dual benefit.56 The Police Electronic Crime Laboratory in Wellington has integrated with the National Cyber Crime Centre (NC3). First.

Child Prostitution and Child Pornography became effective in January 2002. deletes. selling. UNICEF estimates that one million children. ‘intentionally or recklessly. modifies. or communication facilities. or (iii) any communication links between computers or to remote terminals or another device. Exemptions are made for the NZ Security Intelligence Service and the Government Communications Security Bureau: see Crimes Act 1961 (NZ) ss253. or (ii) 2 or more interconnected computers. (b) includes any part of the items described in paragraph (a) and all related input.63 Making.CYBERCRIME 277 is not authorised to access that computer system or being reckless as to whether or not he or she is authorised to access that system’ is liable to a maximum of two years’ imprisonment. 63 Crimes Act 1961 (NZ) s250(2). output. in relation to any computer system. processing. receive data from. or (iv) 2 or more interconnected computers combined with any communication links between computers or to remote terminals or any other device. 61 Crimes Act 1961 (NZ) s248 Definitions. The UNICEF-sponsored Optional Protocol on the Sale of Children. storage. distributing or possessing software for committing crime is punishable by up to two years’ imprisonment. mainly girls. 62 Crimes Act 1961 (NZ) s250(1). 254. communicate with. Initially the discussion revolved around the existing international obligations and commitments related to the protection of children. including the UN Convention on the Rights of the Child. and stored data. The conference built and acted upon commitments undertaken at the Stockholm World Congress against the Commercial Sexual Exploitation of Children (1996) and ongoing initiatives in many countries and regions. and without authorisation’. means ‘instruct.61 A person who ‘intentionally or recklessly damages or alters any computer system if he or she knows or ought to know that danger to life is likely to result’ attracts a potential penalty of 10 years’ imprisonment. 64 Crimes Act 1961 (NZ) s251. are forced into the multi-billion 60 Crimes Act 1961 (NZ) s252. or otherwise interferes with any data or software in any computer system’ is liable to penalty of seven years’ imprisonment. .62 A person who. knowingly or recklessly ‘damages.64 Child pornography – international The International Child Pornography Conference held in Austria in 1999 sought to combat child pornography and exploitation on the internet. or otherwise make use of any of the resources of ’ the computer system: computer system — (a) means— (i) a computer.60 ‘Access’. store data in. software.

is to help governments make better policies that are in the long-term interest of the Australian community: www. A Department of Family and Community Services survey found that more than two-thirds of Australians support a ban on internet gambling. Its role. The regulation of gambling is typically a state and territory matter. . The problem Seventy per cent of Australians believe that gambling does more harm than good. In 2004–05 Australians lost $15. expressed simply. The UN Convention on the Rights of the Child65 has been ratified by almost all nation states. social and environmental issues affecting the welfare of Australians. It found that problem gamblers comprise 15 per cent of regular gamblers and account for one-third of all gambling expenditure annually. Internet gambling The Interactive Gambling Act 2001 (Cth) commenced in full in January 2002. To date there are 96 signatories and 22 parties to the Optional Protocol.5 billion in gambling. Australia has the highest number of poker machines per head worldwide.66 The public’s concern is that increased access to gambling through the internet and similar technologies will exacerbate problem gambling.unicef. 2408 clubs and 13 casinos – provide gambling services.au.1 per cent of the total population. Some 7000 businesses – including 2888 hotels.org/crc/. divorce. The Productivity Commission described the new interactive technologies as a quantum leap in accessibility to gambling.278 LAW OF ELECTRONIC COMMERCE dollar commercial sex trade (this includes child pornography) every year. 65 See the UNICEF website: www.5 million people are affected through consequential bankruptcy. The Productivity Commission found that 92 per cent did not want any further expansion of poker machines. The Productivity Commission has found that around 290 000 Australians. or 2. but the federal Parliament has power with regard to internet activities and other communications technologies. are problem gamblers. The Convention recognises child pornography as a violation of children and requires parties to take legislative and practical measures to prevent the exploitative use of children in pornographic materials. The commission’s final report estimated that 1. It requires signatories to criminalise violations of children’s rights and calls for increased public awareness and international co-operation. 66 The Productivity Commission is the Australian Government’s independent research and advisory body on a range of economic. suicide and lost time at work.gov.pc. The Act is the government’s response to the community’s concern about the increase in gambling resulting from recent technologies.

68 If the site on which the content appeared was hosted in Australia and ACMA considers the complaint warranted. For content hosted outside Australia.70 Regulations may provide that civil proceedings do not lie against a person to recover money alleged to have been won or been paid in connection with an illegal interactive gambling service. and • establishing a complaints-based system to deal with internet gambling services where the relevant content (prohibited internet gambling content) is available for access by customers in Australia. The reviews must take into account the growth of interactive gambling services. Interactive Gambling Act 2001 (Cth) Part 3. the social and commercial impact of interactive gambling services. Fines of up to $1. . The responsible minister has the power to designate foreign countries that Australian interactive gambling operators will be banned from providing their services to. and 67 68 69 70 Interactive Gambling Act 2001 (Cth) ss15. 15A. The Act also prohibits the advertising of interactive gambling services. ACMA must also notify internet service providers (ISPs) so that the ISPs can apply the industry standard: this might mean updating internet content-filtering software. The minister is required to undertake regular reviews of the impact of the Act. and online scratch lotteries. The Act defines ‘interactive gambling service’ as including internet casinos and internet poker machines.1 million per day apply. Countries with similar laws have reciprocal powers. which means they can stop operators based in Australia from providing interactive gambling services to customers located in those countries.net. it must refer the complaint to the Australian Federal Police (AFP).67 A person may complain to the Australian Communications Media Authority (ACMA) about prohibited internet gambling content. ACMA can establish an industry standard if there is no industry code or if an industry code is deficient. The Act regulates interactive gambling services by: • prohibiting interactive gambling services from being provided to customers in Australia.au.69 The Act encourages the development of an industry code by ISPs. • prohibiting Australian-based interactive gambling services from being provided to customers in designated countries. Offences apply to both Australian and overseas interactive gambling service providers. See the website of the Internet Industry Association: www. The prohibition applies to casino-type gaming. The industry codes and standards are available at the website of the Internet Industry Association.CYBERCRIME 279 Interactive Gambling Act 2001 (Cth) The Interactive Gambling Act 2001 (Cth) prohibits the provision of interactive gambling to people located in Australia. online ball-byball wagering on sporting events. See Chapter 18.iia. betting on a sporting event after it has commenced and scratch lotteries online.

or stalking online.net. forwarding viruses. as do several other forms of online gambling. Stalking behaviour includes posting improper messages on bulletin boards. and electronic theft. such as the United States. resulting in the loss of 45 jobs from Alice Springs and expertise in intellectual property and electronic commerce. Senator Richard Alston (Liberal. Cyberstalking Various pieces of state legislation define stalking as ‘continued and intentional conduct directed at another person that would cause a reasonable apprehension of violence or detriment to the stalked person or another person’. Victoria) described the Act as ‘strong action to combat the tragic economic and social consequences of gambling in this country’. albeit a small step. The minister has the power to impose additional conditions. 72 See www. 27 March 2001. ‘Cyberstalking’. Lasseters have since closed their internet gambling services in Australia.iia. stalking can involve use of the internet. Australia’s leading internet casino – Lasseters.280 LAW OF ELECTRONIC COMMERCE the effect of the exemptions (there are excluded wagering services.au. email or other electronic communications to harass or threaten another person. is not dealt with directly by legislation in Australia or New Zealand. . press release. Comment In Australia.71 The chief executive of the Internet Industry Association. In 2000. Television broadcasters raised concerns that the legislation may unintentionally apply to certain game shows – such as Video Hits or Classic Catches – where viewers pay a fee via a 1900 phone call. However.72 The latter comment seems to be closer to the mark. Nevertheless the Act is a step. excluded gaming services. When searching for gambling sites. threatening or offensive email. betting on horse races over the internet remains legal. however. in Alice Springs – turned over $100 million. the Act prohibits poker machine or roulette-style gambling. such as lotteries. However. The impact of the Act on access to such sites will be minimal. and excluded lottery services). services that have a designated broadcasting or datacasting link. towards management of the problems caused by gambling. Most internet gambling sites are based offshore. Australians do not look for Australian sites. as there are many ‘reputable’ sites in other countries. Late amendments to the Act addressed these concerns (through exclusions). 71 Senator Alston. before the Act was passed. has stated that the legislation ‘is technically inept and has no real prospects of protecting those whom it claims to protect’. stating they would relocate to Vanuatu.

cyberangels. email or other technology’. in New York. Criminal Code 1924 (Tas) s192. estimates that there are approximately 63 000 internet stalkers and 474 000 victims worldwide.77 73 Crimes Act 1900 (NSW) s562AB. threatening or offensive email. cyberbullies employ a number of methods to threaten and disparage their targets. 74 Crimes Act 1958 (Vic) s21A.org. flaming. ● Websites: Cyberbullies create websites or use social networking sites or blogs to mock. (g). ● Chat rooms: Chat rooms allow cyberbullies to anonymously enter and write anything they want. ISPs are reporting a marked increase in complaints regarding cyberstalking. cyberstalking behaviour includes spamming. an organisation assisting victims of cybercrime. Criminal Law Consolidation Act 1935 (SA) s19AA.CYBERCRIME 281 The Crimes Acts in most jurisdictions describe stalking in general terms. fax. forwarding viruses. even if the stalker can be identified. or otherwise contacting. sends electronic messages about the stalked person to anybody else or makes electronic messages about the stalked person available to anybody else’. leaving it to the courts to consider specific instances. They include: ● Email messages: While this is the most common form of electronic communication. sending electronic messages to. boy or girl at [stated] school’). such as harassment by electronic means. mail. Criminal Code Act 1913 (WA) s338E. 40 per cent of the work of the City Police Computer Investigations Unit in recent years has involved electronic harassment and threats. and electronic theft. fattest. the enforcement of such laws can be problematic. as the offender may not be located within the jurisdiction. CyberAngels is an online safety protection and educational non-profit body. According to CyberAngels. ● Instant Messaging: Cyberbullies can and do use IM on computers and cell phones to send harassing and threatening messages to their targets. Cyberbullies use these to vote online for some insulting topics (for example: ‘The ugliest. ● Voting and Polling booths: Some websites offer users the opportunity to create online polling or voting booths. CyberAngels. In Los Angeles. mocking and insulting their victims in a forum that potentially has a large audience.75 In the ACT. the use of this method for cyberbullying is less pervasive since most email programs allow the use of filters to block offending emails. . etc. torment and harass the intended victims. Crimes Act 1991 (NZ) Part 11.76 However. stalking includes where the offender ‘telephones. 75 See Criminal Code 1899 (Qld) ss359A–359F. Criminal Code Act 1983 (NT) s189. sends electronic messages to or otherwise contacts the stalked person. In cyberspace terms. (h). posting improper messages on bulletin boards. the victim or any other person’. 20 per cent of the 600 cases dealt with by the Stalking and Threat Assessment Unit involve email and other electronic communications. dumbest. 76 Crimes Act 1900 (ACT) s35(2)(f). 77 See www.74 In 1999 the Queensland Criminal Code was amended to extend stalking to conduct utilising the ‘telephone.73 In Victoria and the Northern Territory the offence of stalking specifically includes ‘telephoning.

Password-protected mailing lists and personal emails cannot really be regarded as private: communications can be intercepted. The ease of the technology may encourage some to make threats. it would be relatively safe to predict that as users become more cyber-aware. financial data and other sensitive material. ● using sophisticated encryption programs: these can prevent messages being read by unauthorised people. the jurisdictional problems of the internet present a real barrier to effective enforcement. and ● changing passwords regularly. 78 On stalking generally see Grosse v Purvis [2003] QDC 151 and DPP v Sutcliffe [2001] VSC 43. The criteria used can include the name of the author. International approach to cybercrime Attacks against commercial websites have drawn international attention to the dangers presented by the internet and other computer networks. and many websites provide personal information such as silent phone numbers. The nature of the internet and electronic communications makes it difficult for people to protect their personal information and privacy. Legal recourse will only be available when the law deals with cyberstalking in a meaningful way. and posting controversial material. it will be largely up to the consumer to use social and technical tools to prevent and control cyberstalking. Cybercriminals and cyberterrorists can threaten business and government interests and cause vast damage. Legal and policy approaches to the problem have tended to lag behind the technology. The identity and location of the stalker can be concealed by using anonymous remailers that strip off the message header. until and unless that happens. address and telephone number. or by publicising the victim’s name. certain offensive words and so on. By using chat rooms and bulletin boards. Also. ● using digital signatures and certificates: these will authenticate the author.78 Even without reliable statistics.282 LAW OF ELECTRONIC COMMERCE Cyberspace provides stalkers with new methods to contact victims. stalkers can now enlist others to harass their victim – by impersonating them. ● using gender-neutral names. home and work addresses. Messages can be sent at random or set intervals automatically. identifying photographs of the victim and of his or her home. making tracing difficult. Technical responses available for the consumer include the following: ● using blocking and filtering software: this can delete email or chat room messages. . Threats can be sent electronically from anywhere in the world. abuses will increase.

as well as the reproduction and distribution of copyright-protected material. ‘Convention on Cybercrime’. The Convention defines offences. . addresses questions related to the liability of individual and corporate offenders and determines minimum standards for the applicable penalties. 23 November 2001: www.coe.govt. misleading and an invasion of privacy. illegal interception of data and interference with computer systems. The New Zealand equivalent is the Unsolicited Electronic Messages Act 2007. facilitate investigations and allow co-operation between the authorities of different nation states. Minister Peter McGauran states that the legislation was a direct response to the groundswell 79 See Council of Europe. ETS no. It clogs email boxes and obscures legitimate email. 185. including the possession of such material after downloading. the Criminal Code 1995 (Cth). intrusive. Spam slows email systems and is often illegal or offensive.CYBERCRIME 283 The Council of Europe’s Convention on Cybercrime is the first international instrument to address various types of offending behaviour involving computer systems.dia. It deals with law enforcement issues including the power to carry out computer searches and seize computer data. networks or data. Prior to the legislation the possibility of liability for spamming was considered under the Privacy Act 1988 (Cth).int. These computer-specific investigative measures also imply co-operation by telecom operators and ISPs – their assistance is vital in terms of identifying computer criminals and securing evidence of their misdeeds. the Spam Act 2003 (Cth)? It is curious that the word ‘spam’ does not appear in the body of the Act.conventions.nz/diawebsite. and in due course to federal legislation. The Convention includes provision for the co-ordinated criminalisation of computer hacking and hacking devices. except for the title section. Open for signature – Budapest. the relevant state criminal legislation and at common law. 80 See Department of Internal Affairs. Spam can be offensive. meaning ‘unsolicited multiple postings of electronic mail’. Spam Who could have predicted that Monty Python’s use of the word ‘Spam’ continuously and ludicrously in a comedy skit would result in a new term. to require data-subjects to produce data under their control and to preserve or obtain the expeditious preservation of vulnerable data by data-subjects’. computer-related fraud and forgery.79 It aims to harmonise national legislation in this field. ‘Anti-spam’: www. In Australia the reviewing Senate Committee described spam as a cancer.nsf/wpg_URL/ServicesAnti-Spam-Index. It prohibits online child pornography.80 The problem All email users have experienced spam.

Receiving positive responses of less than 1 per cent can be profitable for the spammer. It states that all commercial electronic messages (solicited and unsolicited) must include the statement that the recipient may unsubscribe by replying using an electronic address set out in the message. The cost to spammers can be as little as 0.83 Sender information All commercial electronic messages must: • clearly and accurately identify the person who authorised the sending of the message.00032 cent to obtain one email address using appropriate harvesting software. the Act uses ‘unsolicited commercial electronic message’. In brief. a person must not send. Costs arise through increased download times and lost productivity.284 LAW OF ELECTRONIC COMMERCE of business and community anger about the costly and disruptive occurrence of spam. • comply with the regulations. see below. . In addition 81 82 83 84 www.4 billion.htm. The word ‘message’ is used to ensure that the legislation extends to other sorts of electronic communications. though it is the colloquial term. • include accurate information about how the recipient can readily contact the sender. Other studies believe this figure to be conservative. According to Star Internet.au/publications/NOIE/spam/final_report/what. a large ISP in the United Kingdom. such as SMS messages. The statement ‘must be presented in a clear and conspicuous manner’ and the electronic address must be ‘reasonably likely to be capable of receiving’ such a message for ‘a period of at least 30 days after the message is sent’.81 and only 0.003 cent to send a single email. Spam Act 2003 (Cth) This Act deals with unsolicited commercial electronic messages. or cause to be sent. a commercial electronic message unless the recipient has consented to the message being sent.84 Unsubscribe function Section 18 of the Act deals with this area. and • reasonably be likely to be valid for at least 30 days after the message has been sent. An EU study in 2001 estimates that the worldwide cost of spam is approximately AUD$18. Spam Act 2003 (Cth) s17. The Unsolicited Electronic Messages Act 2007 (NZ) became operational in 2007. Ferris Research estimates that US companies lost US$8.gov.noie.82 The word ‘spam’ is not used or defined in the Act other that in the title. Spam Act 2003 (Cth) s16.9 billion in 2002. the cost in lost productivity is AUD$915 per employee per year.

cll 3. an electronic message is a designated commercial electronic message if: (a) the sending of the message is authorised by any of the following bodies: (i) a government body. charities and educational institutions are granted a special exemption from the application of the Act in certain circumstances. 4. that the message was sent by mistake.CYBERCRIME 285 the section requires the electronic address to have been ‘legitimately obtained’. logo and contact details.86 Defences include the fact that the recipient consented. The Act does not regard email as spam if it contains factual information (with or without directly related comment) and additional peripheral information such as the sender’s name.87 Factual information The greatest weakness in the legislation is the exemption for sending ‘factual information’. ● an electronic version of a neighbourhood watch newsletter which is sponsored by the local newsagent. Spam Act 2003 (Cth) Schedule 1. religious organisations. the explanatory memorandum states that the provision is designed ‘to ensure that messages which may be seen to have some form of commercial element. religious organisations and charities For the purposes of this Act. cl 2. but which are primarily aimed at providing factual information are not covered by the rules’. (3).89 Clauses 3 and 4 of Schedule 1 provide: 3 Government bodies. (4). and 85 86 87 88 89 Spam Act 2003 (Cth) s18(1).85 An unsubscribe message is defined as ‘an electronic message to the effect that the relevant electronic account-holder does not want to receive any further commercial electronic messages from the sender’. political parties. (iv) a charity or charitable institution. (iii) a religious organisation. or that the message only contained factual information. ● factual information relating to bird-watching that is sponsored by a commercial entity. Exemptions Government bodies. Spam Act 2003 (Cth) s18(2). Spam Act 2003 (Cth) s18(9). and (b) the message relates to goods or services. It gives as examples: ● an electronic message from a private law firm which includes an information sheet outlining the effects of a particular court decision. (ii) a registered political party. political parties.88 ‘Factual information’ is not defined in the Act. ● an electronic newsletter from the local chamber of commerce which is sponsored by one of its members. However. Spam Act 2003 (Cth) Schedule 1. .

Spam Act 2003 (Cth) Part 5. Spam Act 2003 (Cth) Part 6.93 and ● the commencement of proceedings in the Federal Court for breach of a civil penalty provision. Remedies The main remedies for breaches of this Act are civil penalties and injunctions. or has been. enrolled as a student in that institution. in certain circumstances. 4 Educational institutions For the purposes of this Act.90 ● acceptance of an enforceable undertaking.95 ACMA alleged that Clarity1 contravened section 16(1) of the Spam Act: that ‘unsolicited commercial electronic messages’ must not be sent. Spam Act 2003 (Cth) Part 4. The amendments would make it legal. and (b) either or both of the following subparagraphs applies: (i) the relevant electronic account-holder is.92 ● application to the Federal Court for an injunction. [2006] 410 FCA. of the goods or services concerned. an electronic message is a designated commercial electronic message if: (a) the sending of the message is authorised by an educational institution. Clarity1 had sent or caused to be sent: 90 91 92 93 94 95 Spam Act 2003 (Cth) s41. of the goods or services concerned. Spam Act 2003 (Cth) Schedule 3. . or has been. or prospective supplier.91 ● the issuing of an infringement notice.286 LAW OF ELECTRONIC COMMERCE (c) the body is the supplier. and (d) the institution is the supplier. which includes: ● a formal warning. for inspectors and police to enter homes and search and seize computers and other possessions without a search warrant and without the consent of the person whose home was entered. enrolled as a student in that institution.94 Search and seizure The Spam (Consequential Amendments) Act 2003 (Cth) makes amendments to the Telecommunications Act 1997 (Cth) and the Australian Communications and Media Authority Act 2005 (Cth) to enable investigation and enforcement of breaches of the Spam Act. and (c) the message relates to goods or services. Nicholson J examined the first application of the legislation in an Australian superior court in ACMA v Clarity1 Pty Ltd. The Act provides a tiered enforcement regime available to ACMA. (ii) a member or former member of the household of the relevant electronic account-holder is. or prospective supplier. The wording is such that the same could be done to a recipient of spam.

97 An unexplained failure to call witnesses in relation to this burden of proof provision will allow the application of the rule in Jones v Dunkel:98 an inference that the uncalled evidence or missing material would not have assisted the respondent’s case. from March 2001 to the hearing date. none of which related to a failure to remove an electronic address from the database. or that the sender did not know or had not ascertained with reasonable diligence that the message had an Australian link.CYBERCRIME ● 287 ● at least 213 443 382 Commercial Electronic Messages (CEM). citing Dilosa v Latec Finance Pty Ltd (1966) 84 WN (Pt 1) (NSW) 557 at 582. many of which were highly questionable. The sender must prove that the relevant electronic account-holder (the recipient) consented to the sending of the message. . In Clarity1’s favour Nicholson J identified three mitigating facts: each of the CEMs included a functional unsubscribe facility. to 2 291 518 unique electronic addresses. 2000. all of which were acted upon. and at least 56 862 092 CEM. In such a case. it is reasonable to infer consent. Section 16(5) of the Spam Act 2003 (Cth) relates to the burden of proof. and only 80 complaints were made to Clarity1. 99 Heydon. 182 actually placed an order with Clarity1 for its materials. ‘considerable significance may attach if the absent witness is either the party or a senior executive of a corporate party closely engaged in the transactions in question and present in court during the hearing’. Clarity1 raised many defences under the Act. Cross on evidence. and ● the recipients published their electronic addresses on the internet.96 On an analysis of 1 469 820 electronic addresses. to 5 664 939 unique electronic addresses. or that it was sent by mistake. Sydney. 96 Para 58. 97 See JD Heydon. 98 (1959) 101 CLR 298. at [1215]. some 166 000 requests were made for removal from the defendant’s lists. at [7015]. In other words. it is the sender who is obliged to show (to the civil standard of proof) that there is sufficient evidence to raise an issue as to the existence or non-existence of a fact in issue. ● consent may be inferred from the business relationship between Clarity1 and the recipients.99 The term ‘send’ in section 16(1) includes an attempt to send. Nicholson J dismissed Clarity1’s claims that it acted as a charity or an educational institution. of which 41 796 754 were successfully sent. of which 33 199 806 were successfully sent. Butterworths. Clarity1 also claimed consent. 6th edn. arguing that: ● as the CEMs contained an unsubscribe facility and the recipients did not use the unsubscribe facility. For instance. so it is immaterial whether or not the respondents had successfully sent the CEMs. Cross on evidence.

issued in September 2001.102 Nicholson J reasoned that ‘the receipt of electronic messages without more cannot give rise to the inference of consent because the receipt could be accounted for on many bases other than consent .103 Even of the known 182 recipients who placed orders for materials. This is because it is usually difficult to conclude that the message has been read and . . ACMA submitted that it does not follow even in these instances that the 182 purchasers gave consent to the receipt of the CEMs. . and their conduct . Target and so forth. .’101 Clause 2 of Schedule 2 of the Act provides that consent may be inferred from a business or other relationship. initiated by a commercial activity (including provision. Nicholson J concluded: ‘The mere fact that Clarity1 sent a CEM to an electronic address and did not receive a response from the recipient does not provide a proper foundation for an inference of consent. However. . Big W.100 Clarity1 placed reliance on the Office of the Federal Privacy Commissioner’s publication Guidelines to the National Privacy Principles. Nicholson J referred to the governmentissued publication Spam Act 2003: A practical guide for business. Indeed the Explanatory Memorandum explains that even a pre-existing business transaction may be insufficient to imply consent. there was no evidence supporting these arguments. However. other than by inference. Consider a person who anonymously purchases groceries from Coles. [2006] 410 FCA para 89. of information. [2006] 410 FCA para 92. if the addressee has an existing relationship with you and has previously provided their address then it would be reasonable to infer that consent has been provided .104 100 101 102 103 104 [2006] 410 FCA para 72. . . There is no relationship when the communication is one sided’. for a fee or free of charge. in another passage the guidelines add: It is unlikely that consent to receive marketing material on-line could be implied from a failure to object to it. . . it is commonly considered that there are adverse consequences to an individual from opening or replying to email marketing – such as confirming [that] the individual’s address exists. [2006] 410 FCA para 97. or of services) or other communication between you and potential addressee. .288 LAW OF ELECTRONIC COMMERCE Other than evidence by eight affidavits by deponents who indicated that they were ‘happy’ to receive the spam. [2006] 410 FCA paras 75–79. goods. as long as it is consistent with the reasonable expectations of the addressee. which stated that ‘it may be possible to infer consent from the individual’s failure to opt out’. For example. Nevertheless. Nicholson J inferred conferred consent in the ‘limited instances’ of the 182 purchasers. in particular the following passage: You may be able to reasonably infer consent after considering both the conduct of the addressee and their relationship with you. There is no consent to spam. neither that evidence nor Clarity1’s claims indicate that Clarity1 was aware of such consent prior to dispatch.

105 However. The Act prohibits unsolicited commercial electronic messages with a New Zealand link. the respondents did not consider whether the publication of the electronic address on the internet was done in circumstances that met each of the criteria set out in cl 4 of Sch 2 to the Spam Act. functions or duties. and it would be reasonable to assume that the publication occurred with the agreement’ of the publisher of the electronic details. . SMS and MMS (text and image-based mobile phone messaging) of a commercial nature. 105 Spam Act 2003 (Cth) Schedule 2. .CYBERCRIME 289 Spam may be sent to persons who provide their electronic details by way of a ‘conspicuous publication’: where an ‘electronic address has been conspicuously published. 106 [2006] 410 FCA para 108. ‘acquired’ or ‘used’. readily attracting the attention’. Sections 20. cl4. internet pop-ups or voice telemarketing. The court referred to the Macquarie Dictionary meaning of ‘conspicuous’: ‘easy to be seen . and thus there had been a contravention. Also. The court naturally held that section 22 applied to ‘use’ after the commencement of the Act of lists acquired at any time. 21 and 22 respectively provide that address-harvesting software and harvested address lists must not be ‘supplied’. However. such publication only constitutes consent if it is not accompanied by a statement to the effect that the electronic account-holder does not want to receive spam. It does not cover facsimiles. New Zealand response The Unsolicited Electronic Messages Act 2007 (NZ) came into effect in September 2007. . instant messaging. It is based on the Spam Act 2003 (Cth). and pointed out that the CEMs at issue did not relate to academic activities. the spam must relate to work-related business. There were several examples given in evidence of individuals whose email addresses were available from online yellow pages. they maintained that the harvesting occurred prior to 10 April 2004. ACMA countered with the example of an academic whose email address was published on his academic website. when the Spam Act came into operation. and provides that commercial electronic messages must include accurate information about the person who authorised the sending of the message and a functional unsubscribe facility to enable the recipient to instruct the sender that no further messages are to be sent to the recipient. their personal website and trade directories. Address-harvesting software is prohibited. . The Department of Internal Affairs enforces the Act by investigating complaints and enforcing the provisions of the Act. . Nicholson J held that: it may be inferred from the sheer volume of the electronic addresses contained in the Databases and Lists that . The Act applies to email. The department is also charged with undertaking research into technologies used to send spam and advising the New Zealand government.106 Clarity1 used address-harvesting software. However.

Atkinson grossed more than NZ$1.109 The penalty amounted to a small percentage of Atkinson’s overheads. Recipients cannot bring civil action. unreported CIV-2008-409-002391 (December 2008). 45. The UK version of the directive became operative on 11 December 2003. In Chief Executive Department of Internal Affairs v Atkinson107 the defendant admitted sending more than 2 million contravening emails to NZ computers. 107 High Court of New Zealand.000). Justice French imposed a NZ$100.2 million in 2005 by the US Federal Trade Commission. However. The EU Privacy and Electronic Communications Directive was implemented in EU Member States on 31 October 2003. 108 Ibid. . The Act requires senders of unsolicited email advertisements to include an ‘opt out’ facility.. instead law enforcement authorities and ISPs can initiate civil actions on behalf of recipients to recover up to $2 million in damages. and convictions can result in significant fines or imprisonment. There is an exemption for an existing customer relationship: companies may continue to market products by email on an opt out basis. The opt out provision may be a reply email address or an ‘internet-based mechanism’. The directive prohibits unsolicited direct marketing to individuals by electronic communications including email unless consent has been given in advance. Atkinson and his partner had controlled 35 000 computers. sending out a potential 10 billion emails a day. in contrast.courtsofnz. para 21. EU response In the European Union. known as the CAN-SPAM Act. sending out more than 10 billion emails a day. 110 Atkinson and another had previously been fined US$2.108 her Honour commented that the penalty should be ‘substantially discounted’ due to the ‘co-operation and candour in an early stage with the authorities’.290 LAW OF ELECTRONIC COMMERCE The first prosecution under the Act demonstrates the inadequacies of its penalty provisions. recipients may opt out after a 10-day grace period.000 penalty (the maximum possible is NZ$200. Atkinson and another had previously been fined US$2. The sending of multiple commercial emails with misleading headers or which conceal the identity of the sender is prohibited.html. However. became law on 1 January 2004.6 million. See Unsolicited Electronic Messages Act 2007 (NZ) ss32. Atkinson and his partner had controlled 35 000 computers.nz/from/decisions/judgments.110 US response The US federal anti-spam legislation.2 million in 2005 by the US Federal Trade Commission. These emails must be identified as advertisements.govt. para 20.. available at: www. 109 Ibid. Although acknowledging that ‘the deterrent effect of a penalty will be lost if it only marginally increases the cost of the illegal activity’. ‘marketing’ emails may be sent to recipients who have not given specific consent. The New Zealand legislature may need to review the penalty provisions of the Act.

or reduce. No single email should be regarded as spam.112 The legislation requires ACMA to establish and oversee the Do Not Call Register. Do Not Call Register Bill 2006 (Cth). It is estimated that some 80–90 per cent of all spam comes from overseas.CYBERCRIME 291 All organisations sending promotional or commercial emails should determine whether the email complies with legislation in the recipient’s country and the country of dispatch. if you write an article in a magazine.efa. 111 See comments by Electronic Frontiers Australia: www. Using the ‘factual information’ loophole. This is an attempt to end. This loophole has been described as ‘large enough to drive a truck through’. The approach taken is similar to the laws relating to spam: unsolicited telemarketing calls must not be made to a number on the Do Not Call Register unless express or inferred consent has been given by the telephone account holder or nominee. car dealers could send bulk emails stating their name and address and that the latest model is now available. a single unsolicited email to you asking that the article be reprinted elsewhere for a fee would be in contravention of the legislation. and ascertain if any recipient has opted out of receiving advertising by email. one may be regarded as consenting to all spam if one’s email address appears on a letterhead or business card. the more than one billion unwanted invasive telemarketer calls made annually in Australia. the legislation will be ineffective against overseas spam. National Do Not Call Register The Do Not Call Register Act 2006 (Cth) (and the Do Not Call Register (Consequential Amendments) Act 2006 (Cth)) makes it an offence for telemarketers to call any number so registered. which led to ‘rising community concerns about the inconvenience and intrusiveness of telemarketing’.org.au. The federal government chose an opt out system – the growing direct marketing industry employs some 700 000 people.111 Using the ‘conspicuous publication’ rule. . The Act also legitimises some email which almost all would agree should be regarded as spam. Further. The legislation was enacted in response to a significant increase in the number of unsolicited calls in Australia. 112 Second Reading Speech. The scheme covers both calls made in Australia and calls made by overseas telemarketers on behalf of companies operating in Australia. For example. Criticisms The Spam Act 2003 (Cth) bans some email which many would not regard as spam. Critics also argue that the search and seizure requirements should be amended to require the authorities to obtain a warrant.

hacking into computers. Many entities are reluctant to admit a failure in their computers and security systems. organisation or business with no prior breach range from $1100 to $11 000. The resultant crimes include obtaining goods or services by deception.292 LAW OF ELECTRONIC COMMERCE ‘Designated telemarketing calls’ are exempt from the Do Not Call Register. This figure is likely to be quite conservative as most studies and commentators agree that many instances of identity fraud are not reported. voter registration. imaging equipment and colour printers. ● the call relates to goods or services – the body is the supplier. A telemarketing call is a designated telemarketing call if: ● the making of the call is authorised by a government body. obtain government benefits or gain access to services. Breaches of legislation attract civil penalties. ● appointment rescheduling calls. ● solicited calls. stealing and forging documents such as driver’s licences and ‘phishing’. terrorism. a religious organisation. long before the advent of technology. and ● is not restricted by the regulations. ● fault rectification calls. The following are not regarded as telemarketing calls: ● product recall calls. using fake documents. The maximum fine for repeated breach is $1 100 000. In 2003 the Australian Transaction Reports and Analysis Centre (AUSTRAC) estimated that identity fraud costs more than $1. and ● calls not answered by the person to whom the call is made. drug trafficking and identity fraud (the terms ‘identity fraud’ and ‘identity theft’ tend to be used interchangeably). ACMA may also seek injunctive relief.1 billion per year in Australia. or a charity or charitable institution. sometimes not even leaving their computers. In the electronic age. Rogues may use such stolen or fictitious identities to avoid tax obligations. There are also limited exemptions: for political parties. The penalty for a single person. these rogues are using sophisticated means. ● appointment reminder calls. educational institutions and employers to their employees. lies and cunning. Complaints of breaches may be made directly to ACMA. ● calls relating to payments. or prospective supplier. Recent technology has resulted in a sharp increase in identity fraud: fraudsters are quick to utilise scanners. individual politicians and candidates. Phishing is sending an email to a user falsely . of the goods and services. medical and otherwise. Identity fraud Rogues were impersonating others to commit fraud. Identity theft can range from finding identification cards in garbage bins to using card readers.

Two of the terrorists bribed a legal secretary to complete and notarise false affidavits and residency certifications which they then used to obtain official identification papers from the US government. Australians use the internet for banking and financial transactions that require the provision of credit card or other account details over the internet. each year the Australian Taxation Office issues several hundred thousand tax file numbers. In the days that followed. Governmental response The Proof of Identity Steering Committee (POISC) is a cooperative effort by government and the financial sector to address these issues. they then obtained credit cards and purchased hundreds of millions of dollars’ worth of goods and services. On obtaining these replacement driver’s licences. allowing rogues to contact government departments claiming replacement identification documents. Centrelink processes 3–4 million new claims or re-grants. and the only state that has such a 113 See below. and the Department of Foreign Affairs issues more than one million passports. POISC commissioned the Securities Industry Research Centre of Asia-Pacific (SIRCA) to conduct the first comprehensive study of the cost of identity fraud to the Australian community. lists of the missing were published. Skimming is where credit card data is copied from the magnetic strip electronically. 2001.113 Shoulder surfing is where rogues spy on people at ATMs. Identity fraud and terrorism A horrendous case of identity fraud involves the terrorists acts of September 11. digital signature authentication and encryption.CYBERCRIME 293 claiming to be an established legitimate enterprise in an attempt to scam the user into surrendering private information (such as bank account usernames and passwords) that will be used for identity theft. Technological response Possible technological solutions include biometrics such as fingerprint and iris recognition technology. . Many government agencies have websites that allow for online transactions and the exchange of personal information in the provision of government benefits or authorisations such as licences. For example. allowing them to board the planes which they then hijacked. Examples include restaurants where the customer hands over the credit card for payment or where a rogue’s reader is attached surreptitiously to an ATM and the PIN that is entered is observed via a minute hidden camera. Each is a potential target. There is no Commonwealth legislation making it a criminal offence to merely steal or assume another person’s identity.

by doing so. (3) A person who makes a false pretence to which this section applies intending. a particular capacity. The Financial Transaction Reports Act 1988 (Cth) and the Financial Transaction Reports Regulations 1990 provide that it is an offence to open an account in a false name by tendering a false identification document.gov. Other states rely on offences relating to forgery and dishonesty.au/pr/news/media/ and www. South Australia has made identity theft a specific offence: 144B—False identity etc (1) A person who – (a) assumes a false identity. a serious criminal offence. . relevant provisions of the Criminal Code 1899 (Qld) include: ● section 408C(1) fraud.114 Most relevant laws relate to the resultant effect of the action. (2) A person who assumes a false identity makes a false pretence to which this section applies even though the person acts with the consent of the person whose identity is falsely assumed. ● section 441 falsifying records and producing false records. and ● section 408C misappropriation. not the initial preparatory action. or (ii) to have. or facilitate the commission of. In Queensland. by doing so.gov. 115 See www. State and territory legislation deals with general offences such as fraud and false pretences.pdf. a serious criminal offence is guilty of an offence and liable to the penalty appropriate to an attempt to commit the serious criminal offence.police. The Crimes Legislation Amendment (Telecommunications Offences and Other Measures) Act (No.qld. ● section 427(1) false pretences. storage and use of personal information but not the theft of that information. to commit. to commit. is guilty of an offence and liable to the penalty appropriate to an attempt to commit the serious criminal offence. (2) This section applies irrespective of whether the person whose personal identification information is used – (a) is living or dead. ● section 398 stealing. 2) 2004 (Cth) prohibits credit card skimming and internet banking fraud. for example. 144C—Misuse of personal identification information (1) A person who makes use of another person’s personal identification information intending. makes a false pretence to which this section applies. or to be entitled to act in. or (b) consents to the use of the personal identification information. including phishing.parliament. or facilitate the commission of.294 LAW OF ELECTRONIC COMMERCE law is South Australia.au/view/publications/ documents/research/ResearchBriefs/2005/200503.qld. or (b) falsely pretends – (i) to have particular qualifications.115 114 Criminal Law Consolidation Act 1935 (SA) Part 5A. The Privacy Act 1988 (Cth) deals with the collection.

govt. loss of access to email facilities. Phishing dates back to 1996.iis.police. Cross on evidence.0. In 2007 the Australian Attorney General. Philip Ruddock. recent research has indicated that fraudsters gain access to records that list customers of a particular body. of an estimated value of US$929 million. H Pontell.nz/Digital-Strategy-2/. ‘Technological change and the Australian Constitution’. . JD Heydon. Ministry for Communications and Information Technology. In the United States in 2005. Sydney. cyber-crime and white collar delinquency’. The process is relatively easy for anyone with rudimentary internet skills. However. ‘Spam and e-Security’. acma.2 million computer users suffered losses caused by phishing.au/topics/cybercrime/. The United Kingdom reports similar incidences. Australian Institute of Criminology. (2005) 25 Proctor 1–2.au. theft of credit card numbers and social services numbers.digitalstrategy. (2007) Electronic Crime Strategy to 2010: Policing with Confidence. ‘Cybercrime – update and review’. Butterworths.gov. Australian Communications and Media Authority. www.au. Law Book Company. Initially fraudsters randomly selected a target in the hope that they would already have an account with the financial institution imitated. ‘ “Pleased to meet you .govt. 1. Information Technology Law in Australia. www. NZ Police Commissioner. 6th edn. reported that identity fraud costs Australians at least $1 billion a year. . The damage from phishing includes financial loss. Internet Industry Association.CYBERCRIME 295 Phishing Phishing is a form of criminal activity involving attempts to fraudulently acquire sensitive information such as passwords and credit card details by masquerading as a trustworthy person or business. www. Geraldine Chin. The term ‘phishing’ was coined because fraudsters used sophisticated lures as bait to catch unsuspecting prey.spam.gov. Today phishing is more usually carried out by people masquerading as financial institutions and online payment services known to the target.net.html. when hackers phished for credit card numbers. Phishing and other forms of identity fraud are typically dealt with by the relative recent amendments to the Commonwealth Criminal Code 1995 (Cth) Part 10. 1999. Sydney. (2008) The Digital Strategy 2.6 – Telecommunications Services. New Zealand Government. www. The victim’s credit rating may be negatively affected. (2002) 23 Adelaide Law Review.nz/resources/2007/e-crime-strategy/e-crimestrategy. 2000. Further reading O Akindemowo.aic. won’t you guess my name?” Identity fraud. . (2000) MULR 25. Alan Davidson. www. This practice is known as ‘spear phishing’. and then target those customers. Howard Broad. US businesses lose an estimated US$2 billion every year.

typically printouts of electronic records such as electronic mail. as evidence. rules and procedures aim to provide certainty and reliability within the criminal and civil justice systems. The rules of evidence were developed to ensure a just basis for the making of such determinations.1 Although the common law recognises oral contracts. but also its very existence. case law from the 17th and 18th centuries still dictates the form in which evidence must be 1 This statement is traditionally attributed to movie mogul Samuel Goldwyn. Its restraints. hard ‘copies’. New and unanticipated problems emerge when these historic and sometimes antiquated rules of evidence are applied to electronic documents and records. Notwithstanding modern statutes on evidence.17 Evidence of electronic records It is said that a verbal contract is worth the paper it is written on. The law of evidence is central to legal systems. Evidence of electronic records Courts typically establish facts before determining rights and imposing orders. It then tackles the thorny problem of submitting to a court. reliable and the best that is available. This chapter identifies the problems of applying paper-based rules of evidence in the electronic era. 296 . It first addresses how electronic information should be retained for the purposes of its potential use as evidence in legal proceedings and examines the relevant case law and statutory provisions. particularly in circumstances where the electronic version has been deleted. Evidence should be relevant. this oxymoron reflects the problems associated with proving not only the terms of a verbal contract.

Sydney. LexisNexis Butterworths. Electronic documents coming within the purvey of the Electronic Transactions Acts6 are regarded as documents. Sydney.. Nevertheless remnants of the pre-electronic era remain in the law of evidence and copies continue to be treated with suspicion: an explanation as to why the original was not tendered as evidence can be required. 2004.4 The statute’s central provision required: Noe Action shall be brought .3. Cross on evidence. . 2008. subject to the same rules of evidence as paper documents. Chapter 1. Naturally. Lawbook Co. Electronic Transactions (Queensland) Act 2001 (Qld). Electronic Transactions Act 2000 (NSW). Electronic Transactions (Victoria) Act 2000 (Vic). insurance contracts and consumer protection. The efficiencies of electronics. 4 Ibid. c. computerisation and communications have led to streamlining and rationalisation in the preparation of business documents. or worse.5 These provisions are effectively reproduced in modern statutes dealing with such matters as the disposition of land.4.2 The rules relating to documentary evidence emerged when the quill and parchment were in use – copies of documents were originally made meticulously by hand. Electronic Transactions Act 2000 (SA). 2 See JD Heydon. 3 Statute of Frauds 29 Car 2. 7th edn.EVIDENCE OF ELECTRONIC RECORDS 297 presented. Chapter 3 discussed the international legislative approach taken to ensure consumer and business confidence in electronic transactions. Modern photocopy machines make copies which are often indistinguishable from the original. Electronic Transactions Act 2001 (ACT). intellectual property. the law treated such copies circumspectly. Chapter 1 and John Forbes. Electronic Transactions Act 2003 (WA). 7th edn. appreciating the real possibility of transcription error. . often with little regard to legal consequences. 6 Electronic Transactions Act 1999 (Cth). The legislature’s approach here. The assumption. 5. Where copies of ‘originals’ were hand made. . The stated reason in the statute was for the ‘prevention of many fraudulent Practices which are commonly endeavoured to be upheld by Perjury and Subornation of Perjury’. deliberate and undetectable alteration. unlesse the Agreement upon which such Action shall be brought or some Memorandum or Note thereof shall be in Writeing and signed by the partie to be charged therewith or some other person thereunto by him lawfully authorized. 5 Ibid. could only have been that any requirement for ‘writing’ and ‘signature’ would be paper based.. Electronic Transactions (Northern Territory) Act 2000 (NT). s4. Preamble. Background The Statute of Frauds in 16773 required ‘writing’ and a ‘signature’ in specific circumstances in an attempt to prevent or reduce certain frauds which could arise through the use of oral evidence. Electronic Transactions Act 2000 (Tas). the ‘writing’ and ‘signature’ elements.. when these rules were formulated. Evidence law in Queensland. in 1677. referred to a tangible medium such as paper or parchment.

not doing this risks admissibility problems should such documents be required as evidence in court. that is. electronic accounting files. has been reactive rather than proactive: to provide a means of accepting all forms of evidence. In the absence of the Notice to Produce. When a commercial dispute arises. records of internet use and databases. word processing documents. instant message histories. This is not new. Secondary evidence rule Courts are not free to use all information as evidence.7 However. a subpoena for documents. 7 Butera v Director of Public Prosecutions for the State of Victoria (1987) 164 CLR 180 at 186.298 LAW OF ELECTRONIC COMMERCE as in other areas. 9 (1745) 1 Atk. electronic or otherwise. For example. The secondary evidence rule is often referred to as the ‘best evidence’ rule. A. in Omychund v Barker. that party may issue a Notice to Produce. Other exceptions include consent. the original document is admissible but the copy is not. any electronic record and document can be admitted.1. 21. We will now consider the common law principle known as the secondary evidence rule and evidentiary legislation. where a party requires a document in the possession of another to be admitted into evidence. 8 Heydon.8 In applying the common law secondary evidence rule. Subject to appropriate levels of verification and integrity. All commercial parties should retain documents in the form in which the documents are issued or presented. A copy of the original may be admitted as evidence if the party served with a Notice to Produce fails to produce the original. including emails. in many circumstances the courts may reject the admission of or credibility of electronic records. the immediate concern is the ability to prove the issues before a court of law. The former excludes certain relevant information as untested and unreliable. electronic banking records and logs. Cross on evidence. sound and filming recordings and facsimiles can be accepted. 26 ER 15 at 33. 49. 101 and Forbes. where the production of the original is impossible and certain public documents. lost documents.9 stated that no evidence was admissible unless it was ‘the best that the nature of the case will allow’. Evidence Law in Queensland. The general rule is that a secondary evidence document will be inadmissible if the primary document is available. digital photographs. It is the latter rule which is less than satisfactory when applied to electronic records. In 1745 Lord Harwicke. p. courts are often obligated to disregard otherwise relevant material. The two main exclusionary rules are the rule against hearsay and the rule as to secondary evidence of the contents of a document. There are a number of established exceptions. Both rules include several exceptions. . The courts and the legislature have developed principles under which analogue records such as photographs.

a computer’s hard disk. The 10 [2007] HCA 15. as with the signature on a traditional paper document.EVIDENCE OF ELECTRONIC RECORDS 299 The application of this rule to electronic records is fraught with danger. data fluctuations altering a few characters or by the addition of underlying metadata. authenticating an electronic document should be possible within the document itself. the majority judgment stated: Despite criticism of it. An aspect of the rule is that courts should act upon the least speculative and most current admissible evidence available. Also approved impliedly by Kirby and Hayne JJ at para 70. the circumstances of the parties. the accuracy of the copying process and the provenance of the copy tape are satisfactorily proved. Many argue that the original electronic message is the version created in the sender’s computer and that the recipient only acquires a copy. para 4 per Gummow. . DVDs. something which the original rule was at pains to remove. for example. it has vitality. 13 (1987) 164 CLR 180 at 186. The courts need to determine whether electronic records on such media as videotapes. With paper documents. 12 (1987) 164 CLR 180. the court gave itself discretion to consider the weight to be attributed to the evidence. and decided to sidestep the best evidence rule and instead permit consideration of all the circumstances. audiotapes. To prefer the prospective rather than the historical life expectancy tables is to do no more than that. The High Court wrestled with the problematic consequences of a rule formulated as early as the 16th century. 11 [2007] HCA 15. In other words. In 2007 the High Court of Australia in Golden Eagle International Trading Pty Ltd v Zhang10 reaffirmed the ‘vitality’ of the best evidence rule. The majority held that: A copy of the tape is admissible provided the provenance of the original tape. and the other settled and statutory rules of evidence. Ideally. the ‘best evidence rule’ has not fallen completely into desuetude.11 In 1987 the High Court of Australia in Butera v Director of Public Prosecutions for the State of Victoria12 considered the best evidence rule in the context of copied audiotapes. Subject to the exigencies of litigation. a floppy disk and electronic messages are documents for the purpose of the rule. Others would argue that the ‘electronic record’ as received forms the original. especially where it is changed along the path by. In considering the applicability of historical versus prospective actuarial tables. The question of which are admissible and which are not has not been resolved. Callinan and Crennan JJ. the recipient is typically in possession of the original. In relation to electronic messages debate rages over which version is the original and which is the copy: a minimum of eight ‘copies’ of an electronic message come into existence from creation to receipt.13 Such a formulation lends itself well to the electronic age. CDs.

date and time. author. but it did appear wrong to that court to deny advantages to the law of evidence available through new techniques and new devices. 19 [1998] QCA 43. (1989) 52 Modern Law Review 649. and recording conversations. per Williams J. 18 [1966] 1 QB 688 at 703. There should be ‘no difference in principle between a tape recording and a photograph’. and now there are devices for picking up. ‘Such evidence should always be regarded with some caution and assessed in light of all the circumstances of each case. The court noted that evidence of things seen through telescopes or binoculars which could not be picked up by the naked eye have been admitted. 20 [1998] QCA 43. 15 [1966] 1 QB 688. such as email. transmitting. ‘Authenticating electronic mail messages – some evidential problems’.’18 In R v Frolchenko19 in the Queensland Court of Appeal the issue of the signature on a document was briefly canvassed by Williams J. ‘provided the accuracy of the recording can be proved’. His honour noted that given modern methods of communication. The court considered that photographs are admissible ‘on proof that they are relevant to the issues involved in the case and that the prints are taken from negatives that are untouched’. . but can still be authenticated by looking at such things as whether the name appears in typescript at the end of the document. the evidence is relevant and otherwise admissible and the court is satisfied that a tape recording is admissible in evidence.20 One possible factor that the court could take into account is the implementation and use of an audit trail by the organisation or individual who receives or sends the email message.17 This statement ought not be interpreted to mean that such recordings are admissible whatever the circumstances. 16 [1966] 1 QB 688 at 701. The court added. the voices recorded could be properly identified. 14 C Reed.16 The prints are in fact copies reproduced by means of mechanical and chemical devices.300 LAW OF ELECTRONIC COMMERCE header and other additional information in emails and other electronic documents corroborate and authenticate the nature of the document as well as features such as the sender. 17 [1966] 1 QB 688 at 701. In R v Maqsud Ali15 the British court discussed the application of the rule to photographs. many communications in writing will not bear a personal signature.14 The use of a digital signature or a secure or sophisticated electronic signature can help prove the origin of the document as well as authenticate it and verify its contents. The court stated that ‘absence of an immediate challenge to the admissibility of the document on the ground that the party to the litigation was not responsible for its contents is material’. This would go part of the way to demonstrating that the output from the system that is audited is what it purports to be.

Evidence legislation often provides an extremely complicated mechanism for adducing evidence of electronic records. and (c) that throughout the material part of that period the computer was operating properly or. if it is shown that the conditions mentioned in subsection (2) are satisfied in relation to the statement and computer in question. and (b) that over that period there was regularly supplied to the computer in the ordinary course of those activities information of the kind contained in the statement or of the kind from which the information so contained is derived. any statement contained in a document produced by a computer and tending to establish that fact shall. section 95 of the Evidence Act 1977 (Qld) provides: S95(1) In any proceeding where direct oral evidence of a fact would be admissible. that any respect in which it was not operating properly or was out of operation during that part of that period was not such as to affect the production of the document or the accuracy of its contents. a certificate doing all or any of the following things. be admissible as evidence of that fact. all the computers used for that purpose during that period shall be treated for the purposes of this part as constituting a single computer and references in this part to a computer shall be construed accordingly. or (b) by different computers operating in succession over that period. by any person. if not. that is to say— (a) identifying the document containing the statement and describing the manner in which it was produced. or (d) in any other manner involving the successive operation over that period. or (c) by different combinations of computers operating in succession over that period.EVIDENCE OF ELECTRONIC RECORDS 301 Evidence legislation In Australia most states and territories apply the secondary evidence rule by force of legislation. whether for profit or not. and (d) that the information contained in the statement reproduces or is derived from information supplied to the computer in the ordinary course of those activities. subject to this part. in whatever order. For example. (4) In any proceeding where it is desired to give a statement in evidence by virtue of this section. (2) The said conditions are— (a) that the document containing the statement was produced by the computer during a period over which the computer was used regularly to store or process information for the purposes of any activities regularly carried on over that period. (3) Where over a period the function of storing or processing information for the purposes of any activities regularly carried on over that period as mentioned in subsection (2)(a) was regularly performed by computers. . whether— (a) by a combination of computers operating over that period. of 1 or more computers and 1 or more combinations of computers.

Similar provisions appear in the statutes of South Australia21 and the Northern Territory. 21 Evidence Act 1929 (SA) ss34C. (b) where. in the course of activities carried on by any person. 25 [1993] AC 380. device of technical process.qlrc. subject to the power of the judge to require oral evidence. shall be taken to be supplied to it in the course of those activities. 22 Evidence Act (NT) s26D. 26 [1993] AC 380 at 387.au/wp52.23 In R v Shephard24 the House of Lords considered the then UK equivalent of section 95.qld.22 The section has been criticised by many commentators. stating that oral evidence could be accepted in lieu of a certificate signed by a person with responsibility for the operation of the computer: Proof that the computer is reliable can be provided in two ways. www. 52. 58. ‘The receipt of evidence by Queensland courts: Electronic records’. . 24 [1993] AC 380. that information. Lord Griffiths at 386. 23 For example the Queensland Law Reform Commission’s Issues Paper. and purporting to be signed by a person occupying a responsible position in relation to the operation of the relevant device or the management of the relevant activities (whichever is appropriate) shall be evidence of the matters stated in the certificate and for the purposes of this subsection it shall be sufficient for a matter to be stated to the best of the knowledge and belief of the person stating it.26 As a consequence. if duly supplied to that computer.302 LAW OF ELECTRONIC COMMERCE (b) giving such particulars of any device involved in the production of that document as may be appropriate for the purpose of showing that the document was produced by a computer.gov. Either by calling oral evidence or by tendering a written certificate in accordance with the terms of paragraph 8 of Schedule 3 (s 95(4) Queensland). (c) dealing with any of the matters to which the conditions mentioned in subsection (2) relate. it is most important for all organisations to consider engaging staff who become sufficiently familiar with the organisation’s computer system to be in a position to give evidence of its reliability and of the process of record keeping: (a) information shall be taken to be supplied to a computer if it is supplied thereto in any appropriate form and whether it is so supplied directly or (with or without human intervention) by means of any appropriate equipment. information is supplied with a view to its being stored or processed for the purposes of those activities by a computer operated otherwise than in the course of those activities.html. For the NZ approach see Evidence Act 2006 (NZ) subpart 8 – Documentary evidence and evidence produced by machine. 55B.25 The House of Lords held that oral evidence as to the requirements of the section concerning the workings of the computer could be satisfied by ‘the oral evidence of a person familiar with the operation of the computer who can give evidence of its reliability and such a person need not be a computer expert’. WP No.

(b) may make findings based on a certificate in the prescribed form signed by a person with knowledge and experience of the processes by which the reproduction was made. and is called as a witness in the proceeding. a record relating to any business and made in the course of that business from information supplied (whether directly or indirectly) by persons who had. whether or not that other document still exists’. (c) may make findings based on a certificate in the prescribed form signed by a person who has compared the contents of both documents and found them to be identical. Evidence Act 1906 (WA) s79C. The Evidence Act 1906 (WA) contains a similar provision.27 Section 55 of the Evidence Act 1958 (Vic) similarly provides: S55 Admissibility of documentary evidence as to facts in issue (1) In any legal proceeding (not being a criminal proceeding) where direct oral evidence of a fact would be admissible. a court: is not bound by the rules of evidence and— (a) may rely on its own knowledge of the nature and reliability of the processes by which the reproduction was made. and the person who supplied the information recorded in the statement in question is called as a witness in the proceeding. or forms part of. or (d) may act on any other basis it considers appropriate in the circumstances. Evidence Act 1906 (WA) s73A(1). Evidence Act 1906 (WA) s73A(2).29 In determining whether a particular document accurately reproduces the contents of another. . Where a document ‘accurately reproduces the contents of another document’ it is admissible in evidence before a court ‘in the same circumstances. as that other document. personal knowledge of the matters dealt with in the information they supplied. and for the same purposes. any statement contained in a document and tending to establish that fact shall be admissible as evidence of that fact if— (a) the maker of the statement had at the time of the making of the statement personal knowledge of the matters dealt with by the statement. or may reasonably be supposed to have had.EVIDENCE OF ELECTRONIC RECORDS 303 (c) a document is to be taken to have been produced by a computer whether it was produced by it directly or (with or without human intervention) by means of appropriate equipment. or (b) the document is.30 27 28 29 30 Evidence Act 1977 (Qld) s95(6).28 but an amendment was recently inserted to effectively remove the best evidence rule: section 73A provides that reproductions are admissible and the ‘best evidence rule [is] modified’.

a copy of the document in question which has been produced. Third. following provisions elaborate.33 This definition explains the rationale of the legislation. s47. if the document in question is an article or thing on or in which information is stored in such a way that it cannot be used by the court unless a device is used to retrieve. would be sufficient to impliedly abolish the best evidence rule. and the reproduction is subsequently produced from that record. electronic or other means. New South Wales. The ACT applies the Commonwealth Act.304 LAW OF ELECTRONIC COMMERCE The provision expressly applies to a reproduction made: (a) by an instantaneous process. Reference to a document adduced into evidence is a reference to the contents of that document. the Evidence Acts of the Commonwealth. and by adducing evidence of an admission made by another party to the proceeding with respect to the contents of the documents. 33 Evidence Acts of the Commonwealth.32 In each of these jurisdictions the best evidence rule has been abolished. by a device that reproduces the contents of documents. or purports to be. Section 51 of each of the Acts. state and territory Evidence Acts. Reference to a copy of a document adduced into evidence ‘includes a reference to a document that is not an exact copy of the document in question but that is otherwise identical to the document in question in all relevant respects’. a transcript of the words. Evidence Act 1995 (NSW).31 Legislation abolishing the ‘original document’ rule In the early 1990s an attempt was made to unify all Australian federal. or purports to have been produced. (b) by a process in which the contents of a document are recorded by photographic. including shorthand writing. Evidence Act 2001 (Tas). on its own. if the document in question is an article or thing by which words are recorded in such a way as to be capable of being reproduced as sound. 32 Evidence Act 1995 (Cth). The Acts define ‘document’ by reference to the contents rather than the medium. 31 Evidence Act 1906 (WA) s73A(3). New South Wales. Second. However. specific provisions permit a variety of copies to be adduced. or (d) in any other way. Tasmania and the ACT are identical. In addition to adducing evidence of the contents of a document by tendering the original. This approach. Additionally the Acts make no reference to ‘original’. or in which words are recorded in a code. Today. provides: The principles and rules of the common law that relate to the means of proving the contents of documents are abolished. Tasmania and the ACT. A party may tender a document that is. Emphasis added. or purports to be. entitled ‘Original document rule abolished’. . the evidence may be adduced by tendering a document that is. (c) by a process prescribed for the purposes of this section.

and the jury was instructed to treat the transcripts only as an aid. . the procedure followed by the trial judge could not affect the admissibility of the tape recordings. Where. goes to weight rather than admissibility’.pdf. the fact that certain evidence is admissible does not mean that it will be accepted by the court. evidence may be adduced by tendering a document that has been produced by use of the device.org/pdf/english/texts/electcom/05-89450_Ebook. Ground 11. New South Wales. However. accurately deciphers the sounds captured on the tape. notwithstanding the provisions of s. but not limited to. all documents.EVIDENCE OF ELECTRONIC RECORDS 305 produce or collate it. electronic 34 35 36 37 38 39 Evidence Acts of the Commonwealth. UNCITRAL website: www. As it was. s48(1) . including electronic documents and copies.uncitral. .38 Section 48 applies equally to electronic records. there is doubt or disagreement whether the transcript. (1987) 164 CLR 180. the transcript[s] .34 As a result. and correspondingly. optical or similar means.48(1)(c) as evidence of the contents of the tapes.48(1)(c) of the Evidence Act. (1987) 164 CLR 180 at 195. most importantly it is left to the courts to determine the weight given to them. This section permits copies or printouts to be tendered as evidence in these four jurisdictions. In Eastman v R37 the Federal Court of Australia considered the application of section 48 in relation to the admission into evidence of an audiotape: The definition of ‘document’ includes a record of information from which sounds can be reproduced. sent. The expression ‘data messages’ is defined to include ‘information generated. including. or even be given the same weight throughout. In the present case.35 Dawson J stated that ‘some modes of proof are better than others. evidence may be adduced by tendering a document that forms part of business records which purports to be a copy of or an extract from or a summary of. it seems to us that this should be the role of the transcript. ‘tendering a document that was or purports to have been produced by use of the device’ is satisfactory. In the High Court of Australia in Butera v Director of Public Prosecutions for the State of Victoria. are now admissible in those jurisdictions. the document. were admissible for the purpose of assisting the jury. . [1997] FCA 48. Tasmania and the ACT. [1997] FCA 48. received or stored by electronic.36 As with oral evidence given by witnesses. . but that . the transcripts were received into evidence as an aide-memoire. The expression ‘device’ is used to include a computer system. As the transcripts were admissible under s. International perspective The UN Commission on International Trade Law (UNCITRAL) Model Law of Electronic Commerce 1996 (Model Law)39 includes a provision dealing with ‘Admissibility and evidential weight of data messages’. or part of it. . Fourth. on the evidence adduced in a particular case.

the Model Law provides that in assessing the evidential weight of a data message. Evidence Act 2006 (NZ) s137(1).40 Article 9 provides that the rules of evidence must not deny the admissibility of a data message in evidence on the sole ground that it is a data message. or collated by use of the machine. six states and two territories.44 Where the information is stored so that it cannot be accessed by the court unless the relevant ‘machine. The Evidence Act 2006 (NZ) provides that where a party offers evidence that was produced ‘wholly or partly by a machine. ‘Information in the form of a data message shall be given due evidential weight. because it was thought that such a provision is best placed in a jurisdiction’s evidence legislation and not in its electronic commerce legislation. or technical process’ (for example. and New Zealand. the Model Law was the basis for the Electronic Transactions Acts in all nine jurisdictions. The remaining eight Australian jurisdictions followed the lead of the Commonwealth. it is presumed. device. retrieved. A statement contained in a document may be proved either ‘(a) by the production of that document. stored or communicated. or technical process’. on the grounds that it is not in its original form. or (b) whether or not that 40 41 42 43 44 45 Article 2. electronic mail. Sub-article 9(2).’ In a manner reminiscent of Butera’s case. For example. or technical process’ is used. See Chapter 3. then ‘a party may offer a document that was or purports to have been displayed. scanning) and the machine. or technical process did what that party asserts it to have done’. Specially. The Electronic Transactions Act 2002 (NZ) also did not include this provision. this provision was omitted from the initial Electronic Transactions Act 1999 (Cth) because the Evidence Act 1995 (Cth) had a few years earlier abolished the best evidence rule. sub-article 9(2) states. and to any other relevant factor’.42 this particular provision was omitted from the Australian and New Zealand Electronic Transactions Acts. in the absence of evidence to the contrary. device. nor where the data message is the best evidence reasonably available.306 LAW OF ELECTRONIC COMMERCE data interchange (EDI). device. telegram. in Australia.41 Although the Model Law has been used as a template in more than 50 jurisdictions internationally. to the manner in which its originator was identified. device.45 The Civil Evidence Act 1995 (UK) also effectively abolishes the best evidence rule. even though there was no similar redundancy in most jurisdictions’ legislation at the time. or technical process is ‘of a kind that ordinarily does what a party asserts it to have done’. ‘regard shall be had to the reliability of the manner in which the data message was generated. ‘that on a particular occasion the machine. to the reliability of the manner in which the integrity of the information was maintained.43 however. The substantive provision permits the admission of copies of any degree of remoteness from the original. The Commonwealth. telex or telecopy’. . device. Evidence Act 2006 (NZ) s137(2). making an additional provision obsolete.

typewriting.53 Photographs include still photographs. or by chemical reproduction. Indian Evidence Act 1872 (India) s64. Federal Uniform Rules of Evidence. videotapes and motion pictures.52 Writings and recordings include not only ‘handwriting. mechanical or electronic recording. article X. Indian Evidence Act 1872 (India) s61. recording. article X. Federal Uniform Rules of Evidence. photostating. then a counterpart serves equally as well as the original’. federal courts follow the Federal Uniform Rules of Evidence. rule 1003. except as otherwise provided in these rules or by Act of Congress’.55 ‘[d]ocuments must be proved by primary evidence’56 subject to the customary exceptions. photographing’. see also s22. rule 1001.48 To prove ‘the content of a writing. but also electronic forms such as ‘magnetic impulse. article X. article X.50 The official notes to this provision explain that when the only concern is ‘with getting the words or other contents before the court with accuracy and precision. or photograph is required.54 The Indian Evidence Act 1872 (India) codifies the secondary evidence rule providing that the contents of documents ‘may be proved either by primary or by secondary evidence’. Federal Uniform Rules of Evidence.47 Section 13 encompasses electronic documents by providing that a ‘document’ means anything in which information of any description is recorded. article X. Several US states (such as California) follow this federal approach. including enlargements and miniatures. article X. Federal Uniform Rules of Evidence. or other form of data compilation’. rule 1003. Civil Evidence Act 1995 (UK) s8. the original writing. Official Note to rule 1003. recording. by whatever means and whether directly or indirectly. or by means of photography. x-rays. printing. by the production of a copy of that document or of the material part of it.57 Section 65 provides: 46 47 48 49 50 51 52 53 54 55 56 57 Civil Evidence Act 1995 (UK) s8. and ‘copy’. .46 It is immaterial ‘how many removes there are between a copy and the original’. authenticated in such manner as the court may approve’. In the United States.EVIDENCE OF ELECTRONIC RECORDS 307 document is still in existence. rule 1002.51 A ‘duplicate’ is defined as ‘a counterpart produced by the same impression as the original. or by mechanical or electronic re-recording. Federal Uniform Rules of Evidence. Indian Evidence Act 1872 (India) s65. At the federal level the best evidence rule has been retained and is largely codified in the Federal Uniform Rules of Evidence. or photograph. or by other equivalent techniques which accurately reproduce the original’. means anything onto which information recorded in the document has been copied. in relation to a document. Federal Uniform Rules of Evidence. or from the same matrix.49 Duplicates are admissible ‘to the same extent as an original’ unless a genuine question is raised as to the authenticity of the original or in circumstances in which it would be unfair to admit the duplicate in lieu of the original. while state courts generally follow state legislature rules.

(b) When the existence. or when the party offering evidence of its contents cannot. the process of the Court. condition or contents of the original have been proved to be admitted in writing by the person against whom it is proved or by his representative in interest. and (5) oral accounts of the contents of a document given by some person who has himself seen it. and the fact to be proved is the general result of the whole collection. Primary evidence is defined as ‘the document itself produced for the inspection of the Court’. (d) When the original is of such a nature as not to be easily movable. such person does not produce it.308 LAW OF ELECTRONIC COMMERCE 65 Cases in which secondary evidence relating to documents may be given— Secondary evidence may be given of the existence. (2) copies made from the original by mechanical processes which in themselves insure the accuracy of the copy and copies compared with such copies. (f) When the original is a document of which a certified copy is permitted by this Act. such as a printout of the electronic document. (e) When the original is a public document within the meaning of Section 74. 59 Indian Evidence Act 1872 (India) s63. and then delete the electronic version. These organisations 58 Indian Evidence Act 1872 (India) s62. or not subject to. and when. . For example. is admissible as evidence in a court of law if strictly applying the secondary evidence rule. or of any person out of reach of. (3) copies made from or compared with the original. many organisations print out a hard copy of important emails as a ‘permanent’ record. (g) When the originals consist of numerous accounts or other documents which cannot conveniently be examined in Court. In case (e) or (f). for any other reason not arising from his own default or neglect. produce it in reasonable time. In cases (a). but no other kind of secondary evidence. In case (g). (4) counterparts of documents as against the parties who did not execute them. (c) When the original has been destroyed or lost. any secondary evidence of the contents of the documents is admissible. is admissible. The Act includes specific examples referred to as ‘illustrations’. evidence may be given as to the general result of the documents by any person who has examined them. (c) and (d). after the notice mentioned in Section 66.59 Hard copies of electronic records as evidence Where the original document is electronic.58 Secondary evidence is defined as: (1) certified copies as defined by the Act. In case (b). condition or contents of a document in the following cases: (a) When the original is shown or appears to be in the possession or power of the person against whom the document is sought to be proved. the written admission is admissible. or by any other law in force in India to be given in evidence. and who is skilled in the examination of such documents. a certified copy of the document. a question sometimes arises as to whether a hard copy. or of any person legally bound to produce it.

Law firms that adopt this practice would be professionally negligent. when computer space was expensive and computer specialists urged and advised users to ‘clean out’ the computer space for premium efficiency. in jurisdictions where the secondary evidence rule has been abolished.335 (1993).61 This issue has connections to the role of President Reagan in the Iran-Contra affair in the 1980s. thus jeopardising their opportunity to provide relevant evidence before the court. The court concluded that the printed version of the email contained less information than the electronic version. 63 The first Bush Administration. greater weight would and should be given to the electronic document. The US case of Armstrong v Executive of the President60 involved the status of a printout of an email. In 1986 Oliver North and national security adviser John Poindexter electronically erased thousands of their email messages on their way out of the National Security Council (NSC). it is clear that. In the 21st century computer space is cheap and plentiful. Court rulings established that the archives and records laws for the retention of documents apply to email. The subsequent lawsuit Armstrong v Executive Office of the President62 was brought to prevent the backup records from being erased. Subsequently the Bush Administration63 staged a midnight raid on Inauguration Eve in January 1993 to put the tapes beyond the law. documents and communications. the system’s backup tapes allowed investigators to recover these messages and use them as evidence in court proceedings. Supp. the detailed list of recipients and linkages between messages sent and replies received. The Executive Office of the President argued that the entire NSC was exempt from otherwise applicable US Freedom of Information legislation. particularly if it is thought that the electronic version contained information which would have assisted the court in substantiating the document’s originality and accuracy. The missing information included the date of the transmission. 3d 1274 (DC Cir 1993). and there are many electronic methods of archiving and storing such records. Journalist Scott Armstrong and others sought the NSC records. 60 810 F. The printouts are inferior copies of the electronic documents. 62 1 F. ‘E-Federal e-mail management: A records manager’s view of Armstrong v Executive Office of the President and its aftermath’. Also. This practice is an unnecessary hangover from the early days of computers being used for commercial purposes. The Reagan Administration planned to delete the backups.EVIDENCE OF ELECTRONIC RECORDS 309 risk a ruling that the printout is inadmissible. 61 See Catherine E Pasterczyk. Should such a document be called into question. the date of receipt. it may be reasonable for the court to question why the ‘original’ document was destroyed. the 1970s and 1980s. Researchers were using the records to piece together the controversial arms sales to Iran and the funding of Nicaraguan rebels. The requirement for documents to be kept for set periods of time under statutes of limitation applies equally to electronic documents. (1998) 32-2 ARMA Records Management 10-22. . However.

both parties would be in a much stronger position if they retained the full 64 1 F. The dilemma is the difference between the intended use of the sender and the actual use made by the recipient: it is not clear if the recipient’s understanding and use should be seen as dependent on the intention of the sender. When a traditional letter is sent by post. 3d 1274 (DC Cir 1993). Third. postmark and stamps as part of the communication? The envelope and postmark can be evidence of sending. receipt and timing. . there are multiple copies of the email created and copied. On sending. . As long as legal systems require standards for the quality of evidence. There are a number of complicating factors. neither of which is reproduced on the paper copy . the recipient’s ISP and finally the recipient’s RAM space.64 There are no cases in Australia or New Zealand decided on this evidentiary issue.310 LAW OF ELECTRONIC COMMERCE Judge Richey pointed out that a paper copy of the electronic material does not contain all of the information included in the electronic version. temporary space and permanent space. The sender has a copy in the space for Random Access Memory (RAM). to what extent does the sender intend including the envelope.decision. secondary evidence will be rejected or in appropriate cases given less weight for judicial determinations. Who has the original when an email is sent? This is a complicated question and one which has not been adequately dealt with by the courts. . Should a dispute arise. several routers on the internet. Did the sender intend that the entire electronic record form the communication. or only the ‘text’ of the main message? This is not an entirely new problem. He stated: paper and the computer versions of these electronic records are different .org/legal/cases/PROFS_case/richey. the email is copied to the internet service provider (ISP). . A note distributed over these computer system[s] includes information that is not reproduced on the paper copy regarding who has received the information and when the information was received. but the potential remains. Some of this information is not part of the email at the time that it is sent – the final email that is copied differs from the one that was sent. Second. temporary space and permanent space. . Material must be saved in a way that includes all the pertinent information contained therein .eff. there is a requirement to consider the intention of the sender. Hidden from the reader is additional information. Originals and copies – envelopes and attachments The secondary evidence rule is less than satisfactory when applied to electronic records. The recipient may copy the email electronically to storage folders or archives. See also www. the recipient actually receives a different document from that sent. . paper copies of these materials do not include all of the relevant information. This was identified in Armstrong’s case (see above). . First.

The court ultimately required information on the provenance of the original tape. Butera’s case involved an analogue copy. with the organisation’s letterhead and even a digitised traditional signature. . Despite the difference in the process and the result. as recognised in Armstrong’s case. the date and times of revisions and in some cases prior drafts. are secure and are capable of presentation as evidence when required. Digital copying. but not forming part of the message. and attach it to the electronic communication. the number of revisions. This practice raises several questions. for example of DVDs and computer data. Many organisations. and a light pencil notation may become invisible on the copy. there are several complicating factors. 65 These factors arise with many similar word processing programs. Intention and use may both be gleaned from the format and structure used by the sender. This additional information could corroborate claims made by one party regarding a particular statement of affairs. It has been argued that the email would now operate in the same manner as an envelope. The nature and extent of other formats can exacerbate such considerations. the courts – and much of the public discussion – have failed to recognise the distinction between analogue and digital data. When the process operates correctly the copy is identical to the original. However. Copies of analogue data ought to be regarded with greater suspicion than digital copies.EVIDENCE OF ELECTRONIC RECORDS 311 electronic version of. A printout of the attachment and deletion of the electronic file removes this potential corroborative evidence. businesses and individuals prefer their communications to be more formal than emails. white or grey. The reproduction is clearly inferior and less reliable. assuming that the attachment was a simple Microsoft Word file. putting aside the question of tampering. Data recorded onto audio and video tapes is typically analogue. but colours may be marginally copied or turned to black. the email. the same approach is appropriate for digital copies. Fourth. Some modern photocopiers are excellent. perhaps merely corroborating the time and place of the communication. involves recording by the duplication of bits and bytes precisely. the accuracy of the copying process and the provenance of the copy tape. The picture may be less clear and the sound may have decreased quality and increased background noise. Photocopies typically scan the original and attempt to recreate it. for example. which may simply state that the ‘document’ is attached. Should the attachment be kept in its original electronic form or can it be printed out? It may appear that the sender simply prefers the appearance of a formal hardcopy letter.65 Microsoft Word files contain a significant amount of statistical information in addition to the text: the date the file was created. Some prepare a formal electronic letter. It is vital that organisations set up processes which record all steps. Every time analogue data is copied the data is degraded.

if it remains appropriate.qld. Nevertheless. as a matter of practice and convenience.312 LAW OF ELECTRONIC COMMERCE Conclusion As a general principle. There are wellestablished exceptions to this rule. Further reading Alan Davidson. Sydney.au/wp52. In jurisdictions where the secondary evidence rule has been abolished. 52. most parties. (1998) 32-2 ARMA Records Management 10-22. the principle of the secondary evidence rule. In legal proceedings. Attempting to change the medium may have undesirable if not unpredictable consequences. ‘E-Federal e-mail management: A records manager’s view of Armstrong v Executive Office of the President and its aftermath’. (2003) 23 Proctor 34. public documents and the application of a Notice to Produce.66 The probity of the inferior copy must in appropriate cases be questioned. However. 2nd edn. in jurisdictions applying the secondary evidence rule. Documentary evidence in Australia. Catherine E Pasterczyk. 58. 1996. Queensland Law Reform Commission. WP No. 128–29. C Reed. (1989) 52 Modern Law Review 649. ‘Armstrong’s case 10 years on’. .gov. admit undisputed documents into evidence.html. as they contain information which would assist the court in substantiating originality and accuracy.qlrc. Destroying the electronic record in preference to a printed hard copy risks the ‘document’ being inadmissible or being given less weight. courts ought not admit evidence where the loss or destruction was a deliberate act of the party relying on the copy. it is incumbent on the lawyer to do so and for the court to consider. LBC Information Services. www. ‘The receipt of evidence by Queensland courts: Electronic records’. It is reasonable for the court to question why ‘original’ electronic documents have been destroyed. 66 See RA Brown. such as lost or destroyed documents. ‘Authenticating electronic mail messages – some evidential problems’. courts must dictate that the printout is an inadmissible copy. All parties should retain documents in the form in which they were issued or presented. greater weight should be given to the electronic document. where the legitimate interests of the client would be furthered by challenging a hard copy of an electronic record.

On 1 July 1997 the ACA was formed by the merger of the Australian Telecommunications Authority (AUSTEL) and the Spectrum Management Agency (SMA). while protecting consumers and other users.gov. • managing access to the radiofrequency spectrum. 313 . ACMA is responsible for the regulation of broadcasting. Its responsibilities include: • promoting self-regulation and competition in the telecommunications industry.acma. television and radio communications. The Australian Communications and Media Authority On 1 July 2005 ACMA was formed by the merger of the Australian Broadcasting Authority (ABA) and the Australian Communications Authority (ACA).18 Censorship – Broadcast and online content regulation The Australian Communications and Media Authority (ACMA) is responsible for administering legislation regarding the content and regulation of most forms of electronic communications.au/WEB/STANDARD/1001/pc = PC_100675.1 1 See the ACMA website: www. This chapter deals with the role of ACMA and the regulation of internet. telecommunications and online content. radiocommunications. including the broadcasting services bands. • fostering an environment in which electronic media respect community standards and responds to audience and user needs. • representing Australia’s communications and broadcasting interests internationally.

and monitoring compliance with such codes. 2 See www. Up to date lists of currently licensed television and radio broadcasters are available on the ACMA website.2 The Spam Act 2003 (Cth) bans the sending of unsolicited electronic messages. .au/WEB/STANDARD/1001/pc = PC_100012.gov. of channels assigned for digital TV and other information about digital TV and radio can be found on the ACMA website. including email and SMS and the harvesting of email addresses. enforces Australia’s anti-spam law and can make rules about accessing the internet via premium mobile phone services. which deal with offensive and illegal material on the internet and the protection children from exposure to material that is unsuitable. must first be made to the broadcaster concerned. Complaints about the content of programs on radio and television. regulates the content of radio and television services and administers the ownership and control rules for broadcasting services. registering. especially those relating to children’s use of the Internet. The Minister for Broadband.314 LAW OF ELECTRONIC COMMERCE The internet ACMA administers the scheme for dealing with content on the internet. Most aspects of program content are governed by codes of practice developed by industry groups representing the various broadcasting sectors.acma. of ACMA program standards. A search by postcode facility allows access to a list of services that broadcast in that postcode area. issues and renews licences.) Online content regulation is established under Schedules 5 and 7 of the Broadcasting Services Act 1992 (Cth). • providing advice and information to the community about Internet safety issues. Radio and television ACMA plans the channels that radio and television services use. including ABC and SBS services. • undertaking research into Internet usage issues and informing itself and the Minister of relevant trends. • encouraging development of codes of practice for the Internet industry. • liaising with relevant overseas bodies. They can include voice services such as chat and dating lines. Details of the codes. (The term ‘premium services’ relates to a range of voice and data services that are charged at a premium or high rate. The Act gives ACMA the following functions: • investigation of complaints about Internet content and Internet gambling services. and internet websites containing adult content. Communications and the Digital Economy can direct ACMA to make a service provider determination relating to accessing premium services on mobile phones.

. ACMA manages the contract for the service which allows people with a communication impairment to use the telephone in a way that is equivalent to the standard telephone service available to all other Australians. ACMA issues the radiocommunications licences that underpin services that support everyday life. ACMA helps ensure that carriers and carriage service providers comply with their obligations to assist law enforcement and national security agencies. • undertaking research into phone usage. 3 See www. class licences (these authorise users of specified parts of the radiofrequency spectrum to operate on a shared. Its role also includes: • encouraging the development of codes of practice for the telecommunications industry. Licences Licences issued by ACMA include apparatus licences. such as mobile phones. In addition.3 ACMA licenses Australia’s telecommunications carriers and is responsible for infrastructure regulation. broadcasting services. uncoordinated basis). GPS systems and two-way radios.au/WEB/STANDARD/1001/pc = PC_2793 and the Telecommunications Act 1997 (Cth). licences to provide broadcasting services and carrier licences for telecommunications services. and monitors and manages performance by carriage service providers against the Customer Service Guarantee and the universal service obligation. and registering and monitoring compliance with such codes. It also manages the effectiveness and efficiency of certain aspects of the 000 emergency call service. and is responsible for compliance with those licensing requirements and for investigating complaints of interference to radiocommunications services. ACMA also licenses amateur radio operators and marine radio operators and manages low-power open narrowcasting services. enforces the anti-spam laws.gov. and • liaising with relevant overseas bodies and actively participating in international standardisation activities.acma. • providing advice and information to consumers about their rights and safeguards. including for codes covering the planning and installation of telecommunications facilities (these include those for mobile phones). radiofrequency spectrum licences.CENSORSHIP 315 Telephones ACMA administers and allocates all phone numbers within Australia. wireless local area networks.

‘child’ refers to a person under 18 years of age. It also administers the Universal Service Obligation (USO). ACMA monitors compliance and the strategies used to raise consumer awareness of the codes. fixed phone and internet services. books. Internationally there is divergence of opinion regarding appropriate standards in cultural areas such as dress. ACMA monitors and reports on the performance of telecommunications service providers against the timeframes for the provision and repair of the standard telephone service specified in the Customer Service Guarantee. have reasonable access to a standard telephone service. One of the TIO’s main roles is to investigate complaints made against its members. The internet contains the most splendid educational and cultural material. ACMA raises community awareness about communications and consumer safeguards. however. . newspapers and films. There is. any user of the internet knows that material that breaches those standards is available online. ACMA administers complaint schemes for radio. consensus regarding the repugnance of the portrayal of actual extreme violence and child pornography. join the Telecommunications Industry Ombudsman (TIO) scheme. to foster selfregulation. television and internet content and is responsible for ensuring that carriers and eligible carriage service providers. readily accommodate technological change and contribute to an efficient and internationally competitive communications sector. literature and films. There is a range of ACMA information products and campaigns. It also contains offensive and disgraceful material. But there remains disagreement in relation to the age of a ‘child’. no matter where they live or carry on business. the upper limit of which varies from 12 to 21. through the regulatory framework. Internet content There are various degrees of censorship and restrictions applying to television. which ensures that all people in Australia. provide benefits to end-users. radio. including widely used toolkits about mobile phone. including internet service providers (ISPs). payphones.316 LAW OF ELECTRONIC COMMERCE Consumers Consumer codes are registered by ACMA. According to Article 1 of the UN Convention on the Rights of the Child. However. making them enforceable. Industry ACMA works with industry. prescribed carriage services and digital data services.

. even now. alcoholism or suicide. Similarly. see www. This case is the most significant event in terms of pornography on the internet because it removed incentives for policing or enforcement of pornography online. German courts and legislators have sought to extend anti-Nazi law to other jurisdictions to restrict web-based Holocaust deniers. The pictures first make you sick. there is consensus on the fact that offensive material is available on the internet.5 Studies suggest that a majority of internet users have at some stage visited websites that may be regarded as pornographic: some suggest that 5–24 per cent of overall internet usage is spent accessing pornographic sites. US cases Reno v American Civil Liberties Union The Clinton Administration recognised the potential danger of the booming internet pornography business and enacted the Communications Decency Act 1996 (US).8 the US Supreme Court regarded the definitions of ‘indecent’ and ‘patently offensive’ as vague and broad and struck down most of the Act. There were already certain unspeakable images so burned into my brain that.caslon.4 No matter what one’s definition is. I wish I could take a scalpel and cut them out.com. In Turkey the office of an ISP was demolished when it was found to have allowed images of women with uncovered arms and faces. However. These are images that are more than shocking and repulsive. See www. both before and after the case. .htm.au/censorshipguide2.org. See www.ageofconsent. has indexed more than one trillion web pages. 521 US 844 (1997). but with more than a trillion web pages. . if not now at the hands of a sadist. though. in part because you know that every poor child you see on these sites is dead. Some countries have made attempts to control specific kinds of offensive internet sites. then decades from now from drugs. But keeping track of what is available is almost impossible for any government or organisation – Google. ABC (US) journalist Michael Malone wrote about child pornography: This is the very heart of darkness. then angry. it is also true that such material could.CENSORSHIP 317 There are also disagreements as to the meaning of ‘violence’. 4 5 6 7 8 For example. They kill your soul. Communications Decency Act 1996 (US) (CDA). in Reno v American Civil Liberties Union. France has pressured eBay and Yahoo to limit the sale of Nazi memorabilia. for example.6 The figures vary according to the nature and type of survey. even the conservative figure yields several billion pages.eff. ‘offensive’ and ‘indecent’. be hosted off shore. Janet Reno was the Attorney General for the Clinton Administration.7 However.htm.com/ageofconsent. and finally homicidal .

to facilitate research.acma.318 LAW OF ELECTRONIC COMMERCE US v American Library Association In June 2003 the US Supreme Court. One witness. ACMA Chair Chris Chapman. ACMA stated that it was ‘guided by its disposition to allow adults to continue to read. Chief Justice Rehnquist stated: Internet terminals are not acquired by a library in order to create a public forum for Web publishers to express themselves.12 9 10 11 12 539 US 194 (2003). in US v American Library Association. . so they should be permitted to filter out such online material: this sets them up as an exception to the Reno case. At the time it was known as the Australian Broadcasting Authority (ABA). Australia Internet content has been the jurisdiction of ACMA11 since January 2000. . Rather. 539 US 194 (2003).org. learning and recreational pursuits by furnishing materials of requisite and appropriate quality . with some control over such material returned to them. 195.9 held that anti-pornography filtering does not violate free speech rights. regardless of the delivery mechanism’. who maintained a medical site. it would make little sense to treat libraries’ judgments to block online pornography differently. In developing the new content rules. Justice Breyer stated that web surfers can ask librarians to disable filters to access a particular site. Schedule 7 commenced on 20 January 2008. Congress can require public libraries that receive federal funds to provide public internet access to install filters. a library provides such access for the same reasons it offers other library resources. www. The decisions by most libraries to exclude pornography from their print collections are not subject to heightened scrutiny.au. while protecting children from exposure to inappropriate content. expressed concern that young persons with sexually transmitted diseases may have their access to legitimate sites curtailed. . irrespective of the platform. The Bush Administration has argued that federally funded libraries do not include X-rated movies and magazines. Dr Bertman. The Communications Legislation Amendment (Content Services) Act 2007 (Cth) inserted Schedule 7 into the Broadcasting Services Act 1992 (Cth) for the purpose of regulating all content services delivered via carriage services. The negative result may be the limits on the extent to which members of the public may be able to access legitimate internet content. but counsel argued that even people undertaking legitimate research will not ask a librarian to turn off the anti-pornography filter. hear and see what they want. and whether they consist of user-generated content or otherwise.10 The decision gives US legislators the power to control the billion-dollar industry which internet pornography has become since the decision in Reno v American Civil Liberties Union.

14 Internet content was previously regulated under the Restricted Access Systems Declaration 1999 under clause 4(1) of Schedule 5 to the BSA. and ● content which is classified MA15+. .13 If the content has not been classified by the Classification Board. live content services. Under Schedule 7 the following categories of online content are prohibited content: ● any online content that is classified RC or X18+ by the Classification Board (formerly the Office of Film and Literature Classification).CENSORSHIP 319 The provisions are similar to the previous obligations relating to stored content. there is a substantial likelihood that the content would be prohibited content. material containing excessive violence or sexual violence. and ● a co-regulatory approach that provides for the development of industry codes to address issues including the classification of content. procedures for handling complaints about content and increasing awareness of potential safety issues associated with the use of content services. depictions of bestiality. In addition. that is provided by a mobile premium service or a service that provides audio or video content upon payment of a fee. 1) (Cth). Films and Computer Games) Act 1995 (Cth). ‘service cessation’ and ‘link deletion’ notices to remove content or access to content that is the subject of a complaint. 15 SMS is short for Short Message Service and MMS is short for Multimedia Message Service. and/or material that advocates the doing of a terrorist act. it is defined as potential prohibited content. The rules provide that after receiving a complaint and investigating internet or mobile content. ● content which is classified R18+ and not subject to a restricted access system that prevents access by children. link services and commercial content services to have in place access restrictions if providing R18+ and commercial MA15+ content. realistic violence and other material dealing with intense adult themes. very frequent or very strong coarse language. ● ‘take-down’. drug use or violence. and other material that is strong in impact. made 13 Classifications are based on criteria outlined in the Classification (Publications. This includes depictions of simulated sexual activity. detailed instruction in crime. but if it were to be classified. This includes material containing strong depictions of nudity. implied sexual activity. Schedule 7 regulates for: ● providers of hosting services. ACMA may require the content service provider to either remove the content or place the content behind specified access restrictions.14 Mobile premium services including premium rate SMS and MMS15 services and mobile content portals are regulated under the Telecommunications Service Provider (Mobile Premium Services) Determination 2005 (No. National Classification Code and the Guidelines for the Classification of Films and Computer Games 2005. violence or drug use. child pornography. and that is not subject to a restricted access system. material containing strong. This includes real depictions of actual sexual activity.

in Australia then (c) the content is an eligible electronic publication’. Broadcasting Services Act 1992 (Cth) Schedule 7. ACMA must give the hosting service provider a written final take-down notice. A mobile carriage service provider must not supply content classified as MA15+ or R18+ to a customer unless the customer has requested access and has been verified as at least 18 years old. of a book. where the delivery of the service is by means of a carriage service. magazine or newspaper. ‘Content service’ is defined as ‘(a) a service that delivers content to persons having equipment appropriate for receiving that content. Schedule 7 required ACMA to develop a new restricted access systems declaration to regulate access to MA15+ content and R18+ content with an Australian connection. and (b) a print edition is was available to the public . cl2.320 LAW OF ELECTRONIC COMMERCE under subsection 99(1) of the Telecommunications Act 1997 (Cth).17 ACMA can declare that a specified access-control system is a restricted access system in relation to content for the purposes of Schedule 7. and if the content has been classified RC or X18+. Content classified as MA15+ or R18+ must not be supplied by premium SMS or MMS services otherwise than on a number with a listed prefix. or (ii) an audio recording of the text. in the course of an investigation. An eligible electronic publication is defined as ‘(i) an electronic edition of a book. Take-down notices If ACMA is satisfied that content hosted by a ‘hosting service provider’ is prohibited content and there exists an Australian connection. cl47(1). cl14. ACMA is satisfied that content is prohibited content or potential prohibited content and is of a sufficiently serious nature to warrant referral to a law enforcement agency. . or R18+ or MA15+ (without a restricted access system in place) by the Classification Board. but would include evidence of child pornography or the commission of a crime such as sexual assault and common assault. magazine or newspaper. . or (b) a service that allows end-users to access content using a carriage service’. Broadcasting Services Act 1992 (Cth) Schedule 7. amend the mobile premium services determination to remove the access restrictions and designated prefix requirements that are made redundant by Schedule 7 and vary the Telecommunications Numbering Plan 1997 to allow the transfer of the designated prefix requirements from the mobile premium services determination. Broadcasting Services Act 1992 (Cth) Schedule 7. or abridged text. ACMA must notify a member of an Australian police force.18 Eligible electronic publications are exempt. ‘Sufficiently serious nature’ is not defined. cl11.16 Referral to law enforcement agencies If.19 16 17 18 19 Broadcasting Services Act 1992 (Cth) Schedule 7. .

withdraw the notice or issue a final take-down notice.CENSORSHIP 321 If the content is not classified and ACMA is satisfied that. and if the content has been classified RC or X18+. cl62(2). ACMA must give the hosting service provider a written final link-deletion notice. if the content were to be classified by the Classification Board. or R18+ or MA15+ (without a restricted access system in place) by the Classification Board. and if the content has been classified RC or X18+. Broadcasting Services Act 1992 (Cth) Schedule 7.23 Eligible electronic publications are exempt. or R18+ or MA15+ (without a restricted access system in place). The ACMA must then apply to the Classification Board to have the content classified. withdraw the notice or issue a final link-deletion notice.22 Link-deletion notices If ACMA is satisfied that ‘end users in Australia can access content using a link provided by a links service’. and depending upon the classification. by the Classification Board. cl56 (1). Broadcasting Services Act 1992 (Cth) Schedule 7. there is a substantial likelihood that the content would be classified RC or X18+. Broadcasting Services Act 1992 (Cth) Schedule 7. ACMA must issue an interim link-deletion notice. withdraw the notice or issue a final service-cessation notice. and depending upon the classification. cl62(1). ACMA must then apply to the Classification Board to have the content classified. If the content is not classified and ACMA is satisfied that if the content were to be classified by the Classification Board there is a substantial likelihood that the content would be classified RC or X 18+. cl47(2). or R18+ or MA15+ (without a restricted access system in place). ACMA must issue an interim service-cessation notice. and depending upon the classification. eligible electronic publications are exempt. .21 Again.24 20 21 22 23 24 Broadcasting Services Act 1992 (Cth) Schedule 7. If the content is not classified and ACMA is satisfied that if the content were to be classified by the Classification Board there is a substantial likelihood that the content would be classified RC or X18+. Broadcasting Services Act 1992 (Cth) Schedule 7.20 Service-cessation notices If ACMA is satisfied that content hosted by a live content service provider is prohibited content and the service provider has an Australian connection. ACMA must give the live content service a written service-cessation notice. ACMA must then apply to the Classification Board to have the content classified. that ‘the content is prohibited content and the links service has an Australian connection’. or R18+ or MA15+ (without a restricted access system in place). ACMA must issue an interim take-down notice. or R18+ or MA15+ (without a restricted access system in place). cl56(2).

but not upon the request of a concerned content provider. cl43. The distinctions between classifications are intricate and difficult to ascertain. The proposals in respect of offshore content regulation are unworkable.28 R classification includes: ● material containing excessive and/or strong violence or sexual violence. This is one reason why the fee for classification is substantial and generally prohibitive. See generally Broadcasting Services Act 1992 (Cth) Schedule 7.au.iia.322 LAW OF ELECTRONIC COMMERCE Industry codes Schedule 7 encourages bodies and associations that represent sections of the internet industry to develop industry codes. ● child pornography. See the Classification Board’s website: www.30 25 26 27 28 29 30 Available at www. Complaints and investigations Complaints regarding prohibited and potential prohibited content may be lodged with ACMA. Broadcasting Services Act 1992 (Cth) Schedule 7.29 Conclusion Many content providers and hosts have little understanding of censorship law or of classification. ● excessively violent or sexually violent material. ACMA can request classification in response to a complaint. even for trained censors. content providers and internet users. ● material which deals with issues or contains depictions which require an adult perspective. See Broadcasting Services Act 1992 (Cth) Schedule 5. Part 3. Schedule 7 makes provision for ACMA to direct an ISP or content host to comply with a registered code.au. vexatious or not in good faith. Content providers and hosts are not likely to be able to afford multiple applications.4.26 ACMA is required to act on all complaints unless satisfied that the complaint is frivolous.gov. . ● bestiality. and ● real depictions of actual sexual activity. but it is under review.classification.net. A Code of Practice drafted by the Australian Internet Industry Association (IIA)25 has been accepted as the legislative guideline for ISPs. The current version of the Code of Practice is 10. ● material containing implied or simulated sexual activity. While the Code is not mandatory.27 ACMA may also initiate investigations. Some content providers and businesses use offshore service providers rather than risk dealing with Australian law and ACMA. violence or drug use. RC or X classifications include: ● material containing detailed instruction in crime. Ibid.

[2002] EWCA Crim 683. set the standard. This minimises the need for the federal government to become entangled in the detail of content regulation.pdf.org/images/0011/001147/114734eo. Take-down notices. See europa.au. See unesdoc.34 Television The regulation and enforcement of the telecommunications standards and online content provisions of the Broadcasting Services Act 1992 (Cth) is the responsibility of ACMA. Instead. The January 1999 Paris conference on The Sexual Abuse of Children. Program content is governed largely by Codes of Practice developed by industry groups.33 The site of the 1999 Vienna conference on Combating Child Pornography on the Internet points to a range of resources.unesco. It came 31 32 33 34 See www. but most complaints made to ACMA are in relation to overseas content. The Commercial Television Industry Code of Practice was developed by the commercial television industry and has been registered by ACMA. cessation-service notices and linkdeletion notices will have an impact on Australian content. . ACMA registers codes once it is satisfied that broadcasters have undertaken appropriate public consultation and that the codes contain appropriate community safeguards.gov. EU The EU’s European Action Plan for Safe Use of the Internet is an attempt at a European policy. under the watchful eye of ACMA.31 The result of decisions such as Reno v ACLU is that the lawmakers of nations such as the United States are powerless to enact controlling legislation. International comparison UK In R v Westgarth Smith and Jayson32 the Court of Appeal held that merely browsing the internet or opening of email containing indecent photographs of children is an offence under the Protection of Children Act 1978 (England and Wales).acma.htm. the scheme set up pursuant to Schedules 5 and 7 of the Broadcasting Services Act 1992 (Cth) is largely a toothless tiger. the television stations. The international response is stalemated.CENSORSHIP 323 Given the global nature of the internet and online services.eu/scadplus/leg/en/lvb/l33116. Child Pornography and Paedophilia on the Internet was organised by UNESCO.

sport (anti-siphoning) provisions. if a station fails to answer such a complaint within 60 days. The code contains the Television Classification Guidelines.35 ACMA’s enforcement powers The primary responsibility for ensuring that programs reflect community standards rests with the radio and television stations.1. Finally. failure to comply with the direction notice can result in suspension or cancellation of the licence. in writing. the complainant may refer the complaint to ACMA.37 In stage two of what can be a five-stage process. loudness of advertisements. ACMA can impose an additional condition on a licence. Broadcasting Services Act 1992 (Cth) s148.au/WEB/STANDARD/1001/pc = PC_90096. s7. it also accepts direct complaints.2.324 LAW OF ELECTRONIC COMMERCE into effect in September 2007 and operates in conjunction with other ACMA standards regulating programs for children and the Australian content of programs and advertisements. and complaints handling. Commercial Television Industry Code of Practice. In stage three.1. Compliance with the code could itself be made a licence condition. when a breach is found ACMA can request an informal undertaking from a licensee that certain steps will be taken to ensure no future breach of the relevant code provision.gov. or the complainant considers the response unsatisfactory. and covers: • • • • • • program.36 People who have complaints in this area need to first send them. A wide range of possible undertakings can be requested. Licensees are expected to comply fully with the code. or even referral to the Director of Public Prosecutions for prosecution and possible imposition of a fine by the Federal Court of Australia.38 ACMA acts as an independent adjudicator. such as corrective action. . Complaints may be in relation to the terms of the Code of Practice or in relation to children’s content. the proportion of Australian content. Stage four arises when a station fails to comply with a licence condition. and program promotion classification. at stage five. Breaches of the codes are not necessarily breaches of the Act. advertising and political content. disclosure of commercial arrangements in factual programming. accuracy. which set out the classification categories permitted on commercial free to air television and define the type of material that is suitable for each category. advertising time on television. ACMA will then issue a notice directing compliance with the condition. 35 36 37 38 See www. to the station concerned. local content. commercials.acma. Commercial Television Industry Code of Practice. s1. fairness and privacy in news and current affairs.

Big Brother is a reality television program broadcast by Network Ten. Big Brother Uncut is an MA version of the program shown late at night and contains content that would not be suitable for broadcast in other time periods. Network Ten provided ACMA with undertakings about the approach it would take in classifying the 2006 series of Big Brother Uncut.gov. . implied sexual behaviour and full frontal or partial nudity. ACMA announced that the 4 July episode contained strong adult themes. sexual preference. Radio broadcasting codes and breaches Codes of practice Codes of practice are developed under the Broadcasting Services Act 1992 (Cth) by industry in consultation with ACMA. The undertakings were intended to ensure that future programs did not contain material that exceeds the relevant classification criteria.40 In developing such codes.39 ACMA found the episode as a whole was beyond the level of suitability for the MA15+ classification. combined with other classifiable elements such as sexual references. The program presents a group of housemates sharing a house for approximately three months. are not suitable to be broadcast by that section of the industry’. or vilifies. and competing for a cash prize. nationality. it is imperative that broadcasters stay within the Code’s limits’. ACMA found that the episode breached the code. ACMA investigated the episode after receiving two complaints from members of the public that had not been resolved by Network Ten.CENSORSHIP 325 Television Classification Guidelines in practice In March 2006. age. As a result. The undertakings were determined cooperatively between ACMA and Network Ten. ACMA concluded a lengthy investigation of the 4 July 2005 episode of Big Brother Uncut.au/WEB/STANDARD/1001/pc = PC_100201. 40 Broadcasting Services Act 1992 (Cth) s123(2)(a). which requires that material be classified in accordance with the Television Classification Guidelines. race. . in accordance with community standards. gender. with a cumulative intensity beyond that which could be justified by the storyline or program context. any person or group on the basis of ethnicity. 41 Broadcasting Services Act 1992 (Cth) s123(2)(a). among other things: ‘preventing the broadcasting of programs that. ACMA warned that notwithstanding this ‘refreshing course of action .41 39 See www. The Act states that codes may relate to. community attitudes to the portrayal in programs of matter that is likely to incite or perpetuate hatred against. religion or physical or mental disability are to be taken into account.acma. .

the regulations. For qualifying complaints (that is. persons should provide a copy of their complaint to the station. and any other relevant correspondence with the station.46 Under the Act. for instance. The code must be endorsed by a majority of the broadcasting service providers in that section of the industry and the public must have been given an adequate opportunity to comment on the code.326 LAW OF ELECTRONIC COMMERCE Where a section of the industry develops its own code and ACMA is satisfied that it provides appropriate community safeguards. When all relevant information is available. . ACMA considers the information and gives the station an opportunity to respond. a licence condition. as these are made directly to the licensee in the first instance. was reviewed late in 2008. a class licence or a code of practice.com. ACMA is required to acknowledge all complaints in writing. ACMA is required to notify the complainant of the results of its investigation.43 Investigations Under Part 11 of the Broadcasting Services Act 1992 (Cth). vexatious or frivolous). if a complaint relates to a matter covered by a licence condition.42 ACMA can investigate complaints about compliance with any code that is included in the Register. ACMA investigates complaints relating to a possible breach by: • a licensed broadcaster of the Act. but it may rule that particular complaints are in fact frivolous. The Commercial Radio Code of Practice is available at www. ACMA has discretion about whether or not to publish the report of an investigation. The Commercial Radio Code of Practice. is disclosed to the licensee. If it is a licence condition matter.44 or • the ABC or SBS of a code of practice.commercialradio. ACMA assesses the complaint. it can be made directly to ACMA. a copy of the station’s reply (if this has been received). When making a complaint to ACMA. for example. ACMA must include the code in the Register of Codes of Practice. and the matter is covered by the Commercial Radio Code of Practice. no personal and private information provided in the complaint.au. Broadcasting Services Act 1992 (Cth) Part 11. those that are not outside jurisdiction. ACMA is not required to publish an investigation report if publication would disclose matter that is of a confidential character or that is 42 43 44 45 46 Broadcasting Services Act 1992 (Cth) s123(2)(a). ACMA states that it takes all complaints seriously. Broadcasting Services Act 1992 (Cth) s150. vexatious or not made in good faith. the person must first make a written complaint to the station.45 If a member of the public wishes to complain about something of concern they have heard on a program broadcast by a radio station. such as name and address details. However. Broadcasting Services Act 1992 (Cth) s147. This does not apply to code complaints.

) 47 48 49 50 Broadcasting Services Act 1992 (Cth) s179(1). 1. scientific or research purposes or for other purposes in the public interest.acma.48 ACMA has usually not provided personal or private information in an investigation report. Broadcasts may be made on these topics under 1. encourage or present for its own sake violence or brutality. religious instruction.gov. In doing so. ethnicity. ACMA is required to give the person an opportunity to make representations in relation to the matter. including sex and sexual behaviour. ● Broadcasting Services (Commercial Radio Current Affairs Disclosure) Standard 2000 – requires the disclosure of commercial agreements by presenters of current affairs programs. artistic (including comedy or satire). gender.au/WEB/STANDARD/pc = PC_310133..47 Where ACMA intends to publish an investigation report that may adversely affect the interests of a person.5 to 1. race. ● Broadcasting Services (Commercial Radio Advertising) Standard 2000 – requires advertisements to be distinguished from other programs. Broadcasting Services Act 1992 (Cth) s180. The standards are: ● Broadcasting Services (Commercial Radio Compliance Program) Standard 2000 – requires the establishment of compliance programs by licensees. nationality.aca.3(e) if they are presented reasonably and in good faith for academic. religion or physical or mental disability.49 Encouraging violence and brutality – the Alan Jones case In 2007. (Clauses 1. .3 provides: 1. including discussion or debate about any act or matter..3(c)(ii).3(a) and (e) of the code.au/WEB/STANDARD//pc = PC_91766. See internet.50 The complaint against Alan Jones and 2GB alleged breaches under subclause 1.gov. This code applies to all Australian commercial radio stations.8 deal with program content and language. These commenced operation on 15 January 2001 and were extended indefinitely in March 2003. Clause 1. ACMA has three program standards for commercial radio licensees.3 A licensee must not broadcast a program which: (a) is likely to incite.3(d) or 1. . both Alan Jones and the radio station had breached the Commercial Radio Code of Practice.CENSORSHIP 327 likely to prejudice the fair trial of a person. (b) is likely to incite or perpetuate hatred against or vilify any person or group on the basis of age. See www. ACMA found that prominent radio personality Alan Jones of 2GB Sydney had broadcast material likely to encourage violence or brutality and to vilify people of Lebanese and Middle-Eastern backgrounds on the basis of ethnicity. sexual preference.

ACMA was not persuaded that the relevant comments were presented reasonably and in good faith. .215412687582. However. to which there is no appeal as far as I understand at this stage.au/WEB/STANDARD//pc = PC_91716.theaustralian.51 The licensee is permitted to appeal an ACMA decision in the Federal Court under the Administrative Decisions Judicial Review Act 1977 (Cth).zapto. The following is one.gov. to which there is no charge. The licensee – John Singleton.news. which we did. particularly talkback radio.20867. for investigation report.acma.com.org/news/story-468. none of whom are from listeners. then ask Alan and 2GB to spend hundreds of thousands of dollars to defend these letters. .html?condense_comments = true&save_prefs = true. The biker gangs have been much maligned but they do a lot of good things – it would be worth the price of admission to watch these cowards scurry back onto the train for the return trip to their lairs .acma.gov. fair go. .pdf.52 51 See cleaves. Singleton’s last word on the issue was: [Y]ou cannot trash someone’s individual reputation based on five letters from all around Australia. 52 For a list of disputes. from 7 December 2005: AJ: My suggestion is to invite biker gangs to be present at Cronulla railway station when these Lebanese thugs arrive.’ At the conclusion of the investigation Singleton vehemently expressed dissent and frustration. In its report ACMA stated that due to this and previous breaches. . to which there is no answer. see www. details of which will be announced when finalised. He said that if there was recourse. but only on matters of process. see www. the station’s majority shareholder – argued that the material was presented in the public interest: discussion of factors contributing to unrest in the Cronulla area of southern Sydney in December 2005.328 LAW OF ELECTRONIC COMMERCE The ACMA report gives several quotes from the radio program over five days in December 2005 which contributed to its decision.00.au. ‘we will be taking [it]. . Australians old and new should not have to put up with this scum. and then make a finding.acma. Singleton submitted that ACMA’s analysis of the code and findings revealed significant practical problems for commercial radio licensees. Fair go. against either ACMA or their directors’.3(e) by the licensee. focusing on what he described as the ‘lack of recourse’ available for a decision which would have enormous commercial impact.html. it would ‘now move to pursue significantly heightened compliance measures in relation to the potential for future breaches of clause 1.au/story/0. for other materials and sources. During the investigation. and wouldn’t it be brilliant if the whole event was captured on TV cameras and featured on the evening news so that we.au/webwr/_assets/main/lib101068/2gb_%20report1485. family and friends can see who these bastards are . and applied an ‘ordinary listener test’.gov. ACMA will be writing to [the licensee] shortly about the proposed compliance action. see www. and see www. their parents.

CENSORSHIP 329 Conclusion ACMA plays a significant role in administering. Perhaps more crucially. This means that in the global context ACMA’s effectiveness is somewhat limited. but in many respects. In relation to mass forms of communications – television and radio – in Australia. The subsequent season of the defaulting Big Brother series had ended by then. the tools provided by the legislature are inadequate. while the online content provisions of Australian legislation may reduce prohibited content that originates within Australia. for example. investigating and reporting on many forms of electronic communications. The response to the Big Brother case above. its responsibility is substantial. but the opposing view asks – at what cost? . took almost 12 months. Cyberspace libertarians support this freedom of information flow. The 2GB radio example above similarly took so long that it permitted multiple breaches. they have no real impact on the amount of unclassified material reaching Australian users.

that impact will vary according to each particular nation’s place and importance in the world of international trade.19 An international perspective International organisations. In all fields. This means that the laws of one nation state will impact on those of others. in particular. Banking practices. Electronic commerce is by its nature ‘international’. reporting and implementing plans in relation to electronic commerce is astonishing. see Chapter 3. laws and infrastructure. containerisation and time delay as well as different languages.1 The number and extent of organisations studying. and new industry practices. standards. customs. varying modes of shipping. as we have seen. This chapter briefly examines some of the many electronic commerce policies implemented by selected international organisations. have become more sophisticated. International trade has to deal with distance. As the methods and means of trading evolve in a changing technological and social environment. Electronic commerce. privacy and many others. packaging. particularly trade organisations. documents no longer have to be physically delivered and the requirement for written documentation to establish bona fides is diminishing. 330 . trade law. raises questions regarding a number of issues: the security of transactions. taxation. 1 For example the UNCITRAL Model Law on Electronic Commerce which provided the template for legislation in more than one hundred jurisdictions. Commercial parties must adjust to new modes of communication. were among the first to recognise the significance of the electronic commerce revolution and the corresponding need to provide rules and guidance. Several of these organisations’ responses have become international practice or law. protection of intellectual property. traders must meet the needs and demands of everdeveloping communities.

international transport of goods. Austria. international payments. including assisting member states to review and assess their law reform needs and to draft the legislation required to implement the UNCITRAL texts. These will both be discussed in detail below. The commission has carried out work in eight different areas of trade law.AN INTERNATIONAL PERSPECTIVE 331 Trading. insolvency. located in Vienna. was not widely adopted and ultimately lapsed as a result of not being ratified by a sufficient number of member states. electronic commerce. The related Convention. the commission is regarded as the core legal body of the UN system in the field of international trade law and the main vehicle by which the United Nations can perform an active role in the management of international trade. Model Law on International Credit Transfers). To develop the preparatory work on topics within the commission’s program areas. prepares legal texts in a number of key areas. currently named the Working Group on International Contract Practices. UNCITRAL has released one Convention and two Model Laws that affect electronic commerce: the Model Law on Electronic Commerce and the Model Law on Electronic Signatures. including: international sale of goods and related transactions. The UNCITRAL Secretariat. UNCITRAL established three working groups. and two Model Laws – the first for consumer protection in an electronic environment and the other for electronic signatures. The UN Commission on International Trade Law (UNCITRAL) has developed one Recommendation.2 one Treaty. the UN Convention on the Use of Electronic Communications in International Contracts. sale of goods. international payments (Legal Guide on Electronic Fund Transfers. international commercial arbitration and electronic commerce (Model Law). 2 UNCITRAL Recommendation on the Legal Value of Computer Records (1985). transport law. consumer and privacy issues have been addressed by a number of international organisations including APEC. procurement and infrastructure development. UNCITRAL also provides technical assistance to law reform activities. the Working Group on Insolvency Law and the Working Group on Electronic Commerce. The general mandate of the commission is to further the progressive harmonisation and unification of international trade law and to remove unnecessary obstacles to international trade caused by inadequacies and divergence in national legislation affecting trade. UN Commission on International Trade Law (UNCITRAL) Established by the UN General Assembly in 1966. the United Nations and the OECD. such as international commercial dispute settlement. .

4 UN General Assembly Resolution (A/RES/51/628).332 LAW OF ELECTRONIC COMMERCE The UNCITRAL Model Law on Electronic Commerce The aim of the UNCITRAL Model Law on Electronic Commerce is to provide national legislatures with a template of internationally acceptable rules that will create a more secure legal environment for electronic commerce. . this Model Law provides national legislatures with a template. It quickly became clear. that appropriate and relevant laws and practices are necessary in all countries where electronic data interchange and electronic mail are used. in view of the need for uniformity of the law applicable to alternatives to paper-based methods of communication and storage of information.org/pdf/english/texts/electcom/ml-elecsig-e.4 The Model Law has gained significant international acceptance and has been the basis for electronic commerce legislation in more than 100 jurisdictions. become generally known and available. The increased use of electronic authentication technologies as substitutes for handwritten signatures and other traditional authentication procedures has led to the need for a legal framework to deal with the issues that will almost certainly arise. Its intention is to build on the principles underlying the signature provisions of the Model Law on Electronic Commerce. 5 Available at the UNCITRAL website: www.pdf. Like its predecessor. The Model Law assists with this by providing a framework within which such national laws can be developed. It provides standards to assess the legal value of electronic messages and legal rules for electronic commerce in specific areas such as carriage of goods. The UNCITRAL Model Law on Electronic Signatures5 In July 2001 UNCITRAL released its Model Law on Electronic Signatures. ‘signed’ or ‘original’ documents. however. In order to leverage the economic advantages of such technologies. together with the Guide. business requires clarification on their use so as to reduce any uncertainty as to their 3 See Chapters 3 and 5. such as electronic data interchange and electronic mail. such legislation imposed or implied restrictions on the use of modern means of communication by prescribing the use of ‘written’. The UN General Assembly recommended: that all States give favourable consideration to the Model Law when they enact or revise their laws. The decision by UNCITRAL to formulate model legislation on electronic commerce was a response to what appeared to be inadequate and outdated existing national legislation governing these areas. and that all efforts be made to ensure that the Model Law. In some cases. It informs the discussion of electronic commerce laws in international fora and of domestic laws in many countries. adopted 16 December 1996.uncitral. in order to facilitate access to international markets.3 It is intended to facilitate the use of electronic communication and the storage of information.

was and remains the desired objective. the Model Law hopes to assist in shaping more harmonious commercial practices in cyberspace. relying parties. In addition. this principle that is often referred to as ‘technology neutrality’. which include enabling or facilitating the use of electronic signatures and providing equal treatment to users of paper-based documentation and users of computer-based information. irrespective of the medium on which the information may be affixed. signatories. it provides a link between such technical reliability and the legal effectiveness that may be expected from a given electronic signature. The Model Law on Electronic Signatures builds on the fundamental principles underlying Article 7 of the Model Law on Electronic Commerce – that there should be no discrimination on the basis of the media used in the transmission of a signature. Legal harmony. in which the media involved in the transmission of a signature have no effect on the way the relevant law is interpreted. By establishing a set of basic rules of conduct for the various parties that may become involved in the use of electronic signatures (that is.AN INTERNATIONAL PERSPECTIVE 333 legal effect. as used in that Model Law. It offers practical standards against which the technical reliability of electronic signatures may be measured. A state that incorporates both the procedures prescribed in the Model Law of Electronic Signatures and the provisions of the Model Law on Electronic Commerce in national legislation will be creating a ‘media-neutral’ legal environment. This media-neutral approach is also used in the Model Law on Electronic Commerce. stored or communicated. In recognition of the risk that different legislative approaches would probably be taken in different countries. in order to add certainty and truly foster functional equivalence between electronic and ‘original’ signatures. calls arose for a uniform set of basic rules. One of its main features is that it adds certainty to the 6 See Guide to Enactment of the Model Law on Electronic Commerce. and that an electronic signature should therefore be recognised as functionally equivalent to a handwritten signature. . reflect that principle of non-discrimination.6 The words ‘a media-neutral environment’. The Model Law of Electronic Signatures equally reflects the principle that there should be no discrimination among the various techniques used to communicate or store information electronically. The Model Law on Electronic Signatures adopts an approach under which the legal effectiveness of a given electronic signature technique may be predetermined (or assessed prior to being actually used). as well as technical interoperability. The objectives of the Model Law of Electronic Signatures. are essential for fostering economy and efficiency in international trade. it is intended to provide legal guidelines for all situations where information is generated. and third-party certification service providers) that allows appropriate flexibility. It is thus intended to foster confidence in the fact that certain electronic signature techniques can be relied upon in legally significant transactions. para 24.

both domestically and internationally. Desiring to provide a common solution to remove legal obstacles to the use of electronic communications in a manner acceptable to States with different legal. thus playing a fundamental role in promoting trade and economic development. as well as between electronic authentication methods and handwritten signatures. The UN Convention on the Use of Electronic Communications in International Contracts Adopted by the General Assembly in 2005. Convinced that the adoption of uniform rules to remove obstacles to the use of electronic communications in international contracts. Considering that problems created by uncertainty as to the legal value of the use of electronic communications in international contracts constitute an obstacle to international trade. to the extent that the means chosen by the parties comply with the purpose of the relevant rules of law. mentioned above. would enhance legal certainty and commercial predictability for international contracts and help States gain access to modern trade routes. The Convention complements and builds upon both the Model Law on Electronic Commerce and the Model Law on Electronic Signatures.334 LAW OF ELECTRONIC COMMERCE operation of Article 7 of the Model Law on Electronic Commerce. Being of the opinion that uniform rules should respect the freedom of parties to choose appropriate media and technologies. the UN Convention on the Use of Electronic Communications in International Contracts aims to enhance legal certainty and commercial predictability where electronic communications are used in relation to international contracts. enhances trade connections and allows new access opportunities for previously remote parties and markets. social and economic systems. The Convention has many of the same shortcomings of the Electronic Transactions Acts and careful consideration of it should be undertaken before the Convention is acceded to. Noting that the increased use of electronic communications improves the efficiency of commercial activities. the use of automated message systems for contract formation. The Preamble to the Convention provides that signatories are: Reaffirming their belief that international trade on the basis of equality and mutual benefit is an important element in promoting friendly relations among States. the time and place of dispatch and receipt of electronic communications. In April 2009 the Standing Committee of . and the criteria to be used for establishing functional equivalence between electronic communications and paper documents. including ‘original’ paper documents. taking account of the principles of technological neutrality and functional equivalence. including obstacles that might result from the operation of existing international trade law instruments. The Convention addresses the determination of: a party’s location in an electronic environment.

Council for Trade in Services. There is still a need to clarify whether certain products delivered electronically might be classified as goods. MFN. will fall under the WTO’s General Agreement on Trade in Services (GATS). The paper considers the benefits to international trade of the use of the internet and electronic forms of communication. and therefore subject to GATT disciplines. national treatment or additional commitments) are applicable to the supply of services through electronic means . rather than as services. and the Work Program On Electronic Commerce. All GATS provisions. competition. collation and examination of enormous amounts of data. reported: The electronic delivery of services falls within the scope of the GATS.g. . UNCITRAL is responsible for continuously reviewing and explaining developments in internet technologies and for developing new law and legal frameworks for member states. produced by the WTO Council For Trade In Services. As an organisation it works very hard to develop consensus on the most efficacious means by which to implement new technologies and on how to best develop procedures that will reduce risk for businesses seeking to leverage the huge competitive advantages inherent in the rapid transfer. The electronic commerce provisions of the North American Free Trade Agreement (NAFTA) and other regional agreements have been based on the WTO principles. and asserts that the internet. . as an instrument for international trade. With strong regional and domestic considerations to take into . the Trade Related Aspects of Intellectual Property Rights (TRIPS) and the Agreement on Telecommunications Services. In July 2008 the WTO had 153 members.AN INTERNATIONAL PERSPECTIVE 335 Attorneys-General agreed to amend state and territory legislation to permit Australia to adopt the Convention. The WTO is often stymied in its attempts to push a reformist agenda due to the realpolitik of international trade negotiations and its work in the internet milieu is no different. since the Agreement applies to all services regardless of the means by which they are delivered . Interim Report to the General Council. domestic regulation. etc. payments and transfers. transparency. . In March 1998 the WTO released a paper titled ‘Electronic Commerce and the Role of the WTO’. UNCITRAL will continue to provide advice and guidance on the use of hardware/software systems to transact business in cyberspace as they – and the internet itself – develop. The Interim Report on Electronic Commerce.. The WTO agreements that deal with electronic commerce issues operate in conjunction with GATS. 1999. World Trade Organization (WTO) The WTO has acted as a government of governments in trade-related matters. whether relating to general obligations (e. Measures affecting the electronic delivery of services are measures affecting trade in services and would therefore the covered by GATS obligations. 1999. The stated goal of the WTO is not to create a set of new rules to govern the electronic marketplace but rather to use existing frameworks. .) or specific commitments (market access.

Sweden. Hungary. GATT entered into force on a temporary basis in 1948. Poland. The trend in the international economy over time is for nation states to remove trade barriers. Considerable difficulty has been experienced devising agreements that deal with tangibles. the intangible realm of the internet poses challenges that are unlikely to be resolved any more quickly. As mentioned above in relation to the WTO. Turkey. Originally signed by 23 countries in 1947. composed of both developing and developed states. completed in 1994.7 Its purpose is to provide a forum for its members to discuss matters of mutual interest and seek solutions to be applied within each member’s own national context. New Zealand. member states struggle to find consensus on even small issues of trade so it is largely unsurprising that only limited progress has been made in the ongoing process of developing agreements on electronic commerce protocols. Germany. Portugal. Ireland. However the work continues and the future may yet see a comprehensive international trade agreement in the realm of electronic commerce. The Organization for Economic Cooperation and Development (OECD) The OECD comprises 30 member countries. Iceland. Italy. now has 134 contracting parties. Denmark. Greece. This is diminishing as general wealth increases globally. The ITO failed to find support when the US Senate did not ratify it in 1953. The principles of ‘non-discrimination’ and ‘transparency’. Japan. commentators have expressed the hope that nations will create regulations together to avoid the delays and problems associated with the implementation of the GATT principles. Korea. Finland. Austria. One feature of the GATT that represents the non-discriminatory character of the treaty is the Most Favoured Nation clause. It was expected to be superseded by the International Trade Organizations (see the ITO Havana Charter 1948). Mexico.336 LAW OF ELECTRONIC COMMERCE account. are central to the GATT. the Slovak Republic. Norway. which provides that a party giving a trade advantage to one country is required to give that same advantage to all contracting parties. Spain. 7 Australia. The Netherlands. the Uruguay round of the GATT. the difficulties of developing sound policy are increased by the plethora of competing interests and contradictory objectives among the member states. General Agreement on Tariffs and Trade (GATT) The GATT is a multilateral treaty that aims to promote trade among its members. In the electronic commerce domain. taken from the Havana Charter. Canada. Belgium. the Czech Republic. France. Switzerland. even though developing economies have largely tended to take a protectionist position in order to nurture their domestic producers. . the United Kingdom and the United States. Luxembourg.

we should all engage in developing better. Electronic commerce also features in the OECD’s vision for economic growth and improved social conditions. empower and protect consumers. The OECD monitors trends. The Declaration on Protection of Privacy on Global Networks reaffirms privacy as a fundamental right and recognises the importance of the 1980 OECD Privacy Guidelines. consumer protection. businesses and non-member countries – was also asked to develop a taxation framework applicable to electronic commerce. As the leading international taxation research organisation. full and fair disclosure of essential information. technology. taxation and privacy.AN INTERNATIONAL PERSPECTIVE 337 For some 50 years. The Declaration on Authentication for Electronic Commerce recognises the varying approaches taken by nation states to the formation of technology policy and media-specific requirements and espouses the principle that no discrimination should occur in relation to authentication approaches. more broad-based. Angel Gurr´ stated: ıa. and expand internet access and use worldwide. how to develop and implement policy on the collection of personal data and how to protect the privacy of individuals whose data is collected and stored. and economic and social data. Given that this infrastructure has become critical to our economies and societies. analyses and forecasts economic developments and researches social changes and evolving patterns in trade. The Declaration on Consumer Protection in the Context of Electronic Commerce underscores the importance. Release of OECD statements often creates international headlines in the mainstream media and great respect is generally accorded its findings. and OECD members met in 1998 to discuss a range of related issues. The then OECD Secretary-General. governance arrangements 8 See Chapter 13. of transparency in electronic commerce and its constituent transactions. civil society and technical experts on policies that promote competition. Electronic commerce is inherently trans-border. including: the use of secure encryption programs in the public and private sectors. The Declaration encourages businesses to adopt policies and technical solutions in line with the Privacy Guidelines.8 These Guidelines have provided many nation states with the foundation for protecting privacy and for the formation of appropriate laws. The Declaration confirms the need for governments to work closely with business. . environment. privacy and security instruments are being applied by governments and business in relation to electronic commerce. In 2008 the OECD issued the Seoul Declaration on the Future of the Internet Economy. and dispute resolution. Under the Declaration the OECD also takes responsibility for assessing how its competition. for the protection of consumers. The final resolution included a number of clauses to do with consumer protection issues. The OECD has implemented several Declarations resulting from these processes. agriculture. including how to build the trust of users and consumers in the use of technology. the OECD – along with other organisations. advertising online. the OECD has been one of the world’s largest and most reliable sources of comparable statistics. complaints handling.

● OECD Cross-Border Fraud Guidelines (2003). A more decentralised. APEC has become the primary regional vehicle for promoting open trade and practical economic cooperation. ● Money Laundering & Terrorist Financing Vulnerabilities of Commercial Websites and Internet Payment Systems (2008). Peru. ● Mobile Commerce (2007).apec. ● International and Regional Bodies: Activities and Initiatives in E-Commerce (2001).org. Chile. The Philippines. available at www. ● Electronic Commerce: Existing Commitments for Online Supply of Services (1999). ● Ministerial Declaration on Consumer Protection in the Context of Electronic (1998). Thailand.338 LAW OF ELECTRONIC COMMERCE and policies . Hong Kong China. including all the major economies of the Asia Pacific region. It also commits the OECD to improving both the statistical indicators that measure access and use of the internet.oecd. Both governments and the marketplace have developed a high degree of confidence in its findings. Indonesia. Mexico. Republic of Korea. networked approach to policy formulation for the Internet economy that includes the active participation of stakeholders.org. the United States and Vietnam.11 9 Closing Remarks by the OECD Secretary-General Angel Gurr´ at the meeting of the Future of the Internet ıa Economy. Brunei Darussalam. Russia. Singapore. . and its networks. approximately 55 per cent of world GDP and about 49 per cent of world trade. . ● E-commerce: responding to challenges and opportunities (2001). Its goal is to advance Asia-Pacific economic dynamism and sense of community. Canada. . www.org.oecd. The OECD’s electronic commerce initiatives include: ● Implementing the OECD Privacy Guidelines in the electronic environment: focus on the internet (1997). Chinese Taipei. in order to provide reliable data and analysis. Begun as an informal dialogue group. and ● Recommendation of the OECD Council Concerning Guidelines for Consumer Protection in the Context of Electronic Commerce (2008). and there is little doubt that it will continue to be so. Japan. 10 These and other OECD papers are available at www. The members are: Australia. People’s Republic of China.10 The OECD is a global player in the ongoing development and use of the internet. The Asia Pacific Economic Cooperation (APEC) APEC was established in 1989 and has 21 members. Malaysia.9 The Declaration sets out a roadmap to upgrade the communication policies that have helped the internet become the economic driver that it is today and seeks to ensure support for future development. 11 Notes from the website. New Zealand. Papua New Guinea. The 21 APEC members are referred to as ‘Member Economies’ and account for approximately 41 per cent of the world’s population.

The plan sets out a framework and timetable for achieving a 5 per cent reduction in trade transaction costs.12 The e-APEC Strategy was endorsed in 2001. and knowledge and skills development for its members. The Committee on Trade and Investment prepared APEC’s Second Trade Facilitation Action Plan.15 The following activities and projects implement the e-APEC Strategy. electronic commerce and the mobility of business people.org/apec/apec_groups/other_apec_groups/new_economy_-_e-apec. reduces compliance costs. . 13 Ibid. standards and conformance. which was intended to promote the ‘right policy environment’ and provide a framework to strengthen markets. Pathfinder supports business needs. to continue building skills and capacity. infrastructure. 15 See e-APEC Strategy: www. It further found that increased competition and market-oriented policies had helped innovation and investment in internet-related infrastructure. 14 Available at: www. The Strategic Plan provides a framework for the development of Single Window 12 See e-APEC Strategy: www. It is a long-term and actionoriented plan that has three pillars: • to create an environment for strengthening market structures and institutions. The Electronic Commerce Steering Group developed a Data Privacy Pathfinder initiative to enable stakeholders to work together to protect private information in the APEC region and build confidence and trust in electronic commerce. broadband. allows regulators to operate efficiently. In 2000 it released the Action Agenda for the New Economy. • to enhance human capacity building and promote entrepreneurship.org/apec/leaders__declarations/2001/appendix_2_eAPEC_strategy.apec.html.html. The report stated that the e-APEC Strategy continues to grow in importance and exhorted member economies. The APEC Sub-Committee on Customs Procedures adopted the Single Window Strategic Plan and the Single Window Development Plan in 2007. and minimises regulatory burdens. research and development. especially those at earlier stages of implementation.html. It focuses on customs procedures. It also aimed to work towards providing ‘affordable quality access to telecommunications services and the internet’ to communities in all APEC member countries.AN INTERNATIONAL PERSPECTIVE 339 APEC has advanced a comprehensive set of initiatives to help its members economies leverage developments in electronic commerce.org/apec/leaders__declarations/2001/appendix_2_eAPEC_strategy.apec. • to facilitate an environment for infrastructure investment and technology development.13 APEC’s 2004 report ‘Implementing the e-APEC Strategy – Progress and Recommendations for Further Action’14 found that member economies had made significant improvements in e-infrastructure. e-government services and mobile services. provides consumers with effective remedies. electronic commerce.apec.

(1994) ICC Guide to Documentary Credit Operations for the UCP 500.17 (The ICC is also a powerful advocate of self-regulation in the marketplace. www.org/id93/index. APEC deals with the highest levels of government.org/id93/index. Summary APEC is well placed to assist with the development of cooperative activity among its member states. to build confidence in the use of electronic networks. (2) opening markets for goods and services. .iccwbo.html. wealthy economies it represents are highly motivated to find ways to trade at a constant or diminishing cost. was intended to act as a bulwark against the rising tide of nationalist fervour and protectionism that developed in the international political arena after the cessation of hostilities in Europe in 1918. including: the International Court of Arbitration (1923) for resolving cross-border trade disputes. APEC will be at the forefront.19 the International Maritime Bureau. which is an advantage that many other organisations do not share. and (3) supporting the free flow of capital. which is based in Paris. and the ICC Commercial Crime Bureau.html.340 LAW OF ELECTRONIC COMMERCE systems (uniform procedures among members aimed at achieving paperless trading) and enable seamless data sharing. International Chamber of Commerce (ICC) Established in 1919. and to support policy and regulatory reforms that facilitate competition and the expanded reach of networks.org/policy/banking/iccjjdi/index. The range of powerful. It contains six recommendations and provides mechanisms for APEC members to work collaboratively.iccwbo.20 The ICC also publishes widely on all manner of 16 17 18 19 20 www.html.org/court.iccwbo. The ICC’s operational objectives are to serve world business by: (1) promoting trade and investment. www. Almost certainly. the ICC. www. and therefore support the development of shared policy on electronic commerce procedures. The APEC Telecommunications and Information Working Group aims to expand collaboration in dealing with issues of electronic security. 112.18 ) Among its many accomplishments has been the establishment of several agencies. as policy in the electronic commerce arena develops. Charles del Busto.16 This aim has essentially remained unchanged over the last 90 years.iccwbo. The Electronic Commerce Steering Group continues relevant work to implement APEC’s Strategies and Actions Toward a Cross-Border Paperless Trading Environment to enable the electronic transmission of trade-related information across the region by 2020.

who issues validation certificates – which the receiving parties can rely upon – that establish that holders of public keys are who they purport to be. scientific. . professionals and corporations. and to develop cooperation in the sphere of intellectual. The ISO covers all fields except electrical and electronic engineering. called a certifier. the ICC has significant worldwide influence on lawmakers and advisors to all levels of government. International Organization for Standardization (ISO) The ISO is a worldwide federation of national standards bodies. The ICC. These certificates also verify that the ensuring party has the ability to contract and bind either himself or the party they are authorised to represent. and works to further the interests of trade generally. it has also issued revised guidelines for advertising and marketing on the internet.AN INTERNATIONAL PERSPECTIVE 341 business-related topics. It presents views to governments and works with its members to address a plethora of issues. issued in 1997. makes representations to the United Nations and to national governments across the globe. is a general framework for ‘ensuring’ and ‘certification’ of digital messages. 2007. It also works to ensure that governments and intergovernmental organisations understand that regulations and rules impacting on its members must be both cost-effective and efficacious. technological and economic activity. Its mission is to promote the development of standardisation with a view to facilitating the international exchange of goods and services. Two of the proposed guides and model laws proposed by the ICC in this area are the GUIDEC (General Usage for International Digitally Ensured Commerce) and the ICC Model Clause for Use in Contracts Involving Transborder Data Flows. The ICC has indicated that these guidelines will be updated as digital technology develops. The GUIDEC. based upon existing civil and common law and pertinent international principles. It governs the use of public key cryptography for digital signatures and the role of a trusted third party. Brisbane. As a lobby group. It has members from 63 national committees and 7000 member companies and associations from over 130 countries. Legal and practice perspectives on letters of credit under UCP600. continues to be one of the most important international fora in which the practicalities of implementing and using international electronic commerce law are discussed and debated. Wooler.21 The ICC develops and publishes rules that govern the conduct of business across international borders and provides many essential services to the international business community. including those related to electronic commerce. as an organisation of practitioners. which is the 21 See Garth Wooler.